Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

Oral Answers to Questions — TRADE

Oral Answers to Questions — Iran

1 Mr. Sproat: asked the Secretary of State for Trade if he will make a statement on the latest balance of trade with Iran.

The Under-Secretary of State for Trade (Mr. Eric Deakins): The crude deficit on trade with Iran was £234 million in 1974 compared with £68 million in 1973. Between the years the value of imports rose by 116 per cent., reflecting the rise in oil prices, and the value of exports by 65 per cent. In the first quarter of this year exports have continued to rise while imports were 7 per cent. lower than in the first quarter of last year.

Mr. Sproat: I appreciate the figures which the hon. Gentleman has given and the steps which his Department has taken to help achieve this, but is it not a fact that although our figures have risen by 65 per cent., over the same period the Americans and the Japanese have increased the value of their exports by over 100 per cent.? Is it not also a fact that although we recently signed a contract for about £500 million with Iran, the French, just before, signed one for over four times that value? Is it not rather sad—and typical—that we are actually losing our share of the OPEC market?

Mr. Deakins: We are certainly not losing our share in particular markets. However, if we take the OPEC countries as a whole, our performance last year was not as good as that of some of our industrial competitors. Percentage figures can be misleading. It depends upon the

base figure. We were well established in these markets and other countries were not. It is therefore possible for them to achieve much greater proportional percentage increases than ours. Nevertheless, I am confident that the steps that the Government are taking and, more important, the steps that British industry is taking in these markets will ensure that we receive a bigger share in the future.

Mr. Robert Taylor: What is the point of a junior Minister from the Department of the Environment visiting the Building Materials Export Group's stand at Teheran next month? Surely, if a Minister is going, it should be a job for a Minister from the hon. Member's Department?

Mr. Deakins: Department of Trade Ministers are travelling to many other countries this year. The Secretary of State has visited the Gulf States recently, and also Iran. There are plans for further visits later this year. Certainly we should not in any way want to stop other Ministers in specialised areas going to support the efforts of specialised teams of British industrialists trying to sell their products in overseas markets.

Oral Answers to Questions — Tourism

2. Sir George Young: asked the Secretary of State for Trade whether he will make a statement on the representations he has received from the tourist authorities in response to his new guidelines.

Mr. Deakins: Constructive discussions are taking place between my Department and the statutory tourist authorities. In due course, when these discussions are concluded, a further statement will be made.

Sir G. Young: Is the Minister aware that the guidelines which he issued last November and the speech which his right hon. Friend made last week on tourism fall far short of the Government's policy towards tourism for which both the industry and the tourist authorities have been pressing his Department for many months?

Mr. Deakins: Certainly the policies that we have announced have not pleased every section of the trade. However, we are quite confident that, given the one


limitation that everyone must recognise—the need to conserve national resources and not to increase Government expenditure in real terms on tourism—within that parameter and constraint the Government's policy is the right one for the next few years.

Mr. Hall-Davis: In the Minister's next discussion with the tourist authorities will he pay particular attention to the case for reviewing the areas which qualify for tourist development grants? There is a certain illogicality in assuming that areas which are, perhaps, appropriately designated for industrial investment grants should also be the right areas for tourist development. The intermediate areas have a very strong case for some extended help.

Mr. Deakins: We have certainly had a number of representations, both from hon. Members and from outside authorities, about extending to intermediate areas assistance afforded under Section 4 of the 1969 Act. However, we feel that it is much better to concentrate the scarce resources which are available on those areas which have untapped potential but which have the greatest problem of regional unemployment. Although we are sympathetic with the problems of the intermediate areas, in the present state of public expenditure the most we can do is to ensure that the money is spread where it is most needed.

Oral Answers to Questions — DC10 Aircraft (Safety)

3. Mr. Ashley: asked the Secretary of State for Trade when he proposes to give a substantive reply to the letter sent to him by the hon. Member for Stoke-on-Trent, South on 18th February about the conflict of view between the British Civil Aviation Authority and the United States of America Transportation Safety Board regarding the safety of the DC10 aircraft

The Secretary of State for Trade and President of the Board of Trade (Mr. Peter Shore): I have nothing at present to add to my letter of 5th May to the hon. Member. I have been assured by the Civil Aviation Authority, which is responsible for aviation safety, that there is no conflict of view between it and the Federal Aviation Administration, the airworthiness authority of the United States of America, to which recommendations

about the safety of the DC10 have been made by the National Transportation Safety Board.

Mr. Ashley: I appreciate the reason for the delay and I also appreciate the trouble that my right hon. Friend has taken to reply as fully as he has. Nevertheless, is he aware that I cannot understand how an assurance can be given to him that there is no conflict between the Americans and our Civil Aviation Authority? The Americans have specifically called for DC10 floors to be strengthened, and the Civil Aviation Authority has not strengthened the floors of the British DC10s. Will my right hon. Friend call for a meeting between the American and British officials to sort out this problem?

Mr. Shore: The situation is as I have explained to my hon. Friend. The CAA and the FAA are really in very close contact indeed on the question of the safety of the DC10. As my hon. Friend will well recall, the first and most pressing problem was the door of the DC10, which had to be put right, and the CAA certainly satisfied itself that the changes proposed by the FAA had been carried out in respect of British DC10s. Where the matter rests now is that during the intervening months we have had these disturbing reports from the United States about the strength of the body of the wide-bodied aircraft, and it was because of that that I specifically requested the CAA, only last month, to put to our own Airworthiness Requirements Board the very question whether, in the light of these further reports and evidence, it was still satisfied that it was safe to fly the DC10. It is only having received the board's assurance that. having reviewed the matter, it adhered to that view, that I myself am inevitably content with what I believe to be expert and, indeed, impartial advice.

Oral Answers to Questions — Middle East

4. Mr. Hooley: asked the Secretary of State for Trade how many trade missions visited the Middle East in 1974;and how many are planned for 1975.

Mr. Shore: As my hon. Friend the Under-Secretary of State informed my hon. Friend on 23rd January—[Vol. 884, c. 483]—the British Overseas Trade


Board supported 16 outward missions to the Middle East in 1974, in which 221 British firms took part. In 1975, 325 firms are expected to participate in 28 missions to the Middle East.

Mr. Hooley: That is a very fair and encouraging reply, but does my right hon. Friend agree that in view of the enormous revenues which have accrued to the oil countries and, in particular, the fact that those revenues are spilling over to some extent to countries such as Syria, Egypt and Jordan, perhaps even greater effort should be made in this market?

Mr. Shore: I am never satisfied with our efforts in regard to exports, nor shall I be until we are once again back in surplus as a country. I simply make this point about the Middle East: exports to those markets as a whole increased by 63 per cent. last year, which was a respectable showing but not as good as the markets' opportunities warranted. However, I am glad to tell my hon. Friend that there has been a mounting momentum of British exports to the Middle East market. While I gave that overall figure for the whole of 1974, I believe that my hon. Friend and the House would like to know that in the last quarter of last year our exports to the Middle East markets were up by 92 per cent. compared with the corresponding quarter of the previous year, and that in the first quarter of this year they were up by 110 per cent. over the first quarter of last year.

Oral Answers to Questions — Policyholders Protection Bill

5. Mr. Stanley: asked the Secretary of State for Trade what representations he has received from the insurance industry on the Policyholders Protection Bill.

18. Mr. McCrindle: asked the Secretary of State for Trade how many representations he has received on the Policyholders Protection. Bill since its publication.

Mr. Shore: I have received various representations from organisations representing the insurance companies, the brokers and the workers in the insurance industry.

Mr. Stanley: In view of the considerable disquiet which has been expressed by hon. Members on both sides of the House about the underlying principles of

this Bill, will the Secretary of State say why a decision was taken to introduce the Bill in another place? Secondly, will he assure the House that he retains an open mind towards the principles of the Bill, and that if the insurance industry can convince him of the soundness of its alternative proposals he will be willing to drop the Bill which has been introduced?

Mr. Shore: I hope very much that the House and, indeed, the other place, where the Bill has been introduced, will really consider the measure on its merits and against the actual situation that has faced a number of insurance companies during the past year—a situation which I do not feel we can assume has entirely disappeared. The whole purpose of the measure is, after all, to give some consumer protection to the insured, and the scheme that we have put forward will be found, on examination, I hope, to have far fewer demerits than many people suspect and far more merits than many have so far acknowledged.

Mr. McCrindle: Is it not significant that, having considered the Government's proposals, almost the whole of the insurance industry, including the Co-operative Insurance Society, should be opposed to them in large measure? Is it really too late, even now, for the Secretary of State to try to reach a voluntary agreement with the insurance companies which would achieve his objective of consumer protection but would at the same time ensure that companies would not be encouraged to offer uneconomic terms to policy holders knowing that if they get into trouble they will be bailed out by the contributions of other policyholders?

Mr. Shore: There are genuine weaknesses in the scheme put forward by the insurance industry. I am afraid that it was put forward rather late in the day. I wish that the industry had been persuaded to act earlier. But I must tell the hon. Gentleman that the basic objection that he puts forward to my scheme would, in a sense, be the same objection that could be put forward to the industry's own scheme—that is, the whole principle of there being a fall-back, a guarantee, for people who are either unfortunate enough or unwise enough to invest in unsound or imprudently managed insurance companies.

Mr. Ernest G. Perry: Is my right hon. Friend aware of the grave concern and disquiet felt by all those working in the industry at some of the clauses of the Bill? Will he give an assurance that if the trade unions and other organisations represented in the industry want to see him about them, he will seriously consider the clauses that are causing most of the concern which has arisen about the Bill?

Mr. Shore: I listen to my hon. Friend with particular attention when he speaks on this subject, because of his great experience in the industry. I am aware of the disquiet. As he will know, I have already had the opportunity of discussing the purpose of the Bill and some of its major principles with many people, including representatives of trade unions and certainly representatives of co-operative interests, and with the insurance industry itself. I assure my hon. Friend that I am quite willing to consider further whether we can resolve particular difficulties, but I would add that I believe, as I said earlier, that many of the anticipated worries that people have will, on inspection and on proper examination in the other place, be shown to be based, perhaps, upon a misunderstanding of some of the major features of our proposals.

Mr. Higgins: Is it not the case that the Secretary of State's only response to the full day's debate we had and the criticisms made on that occasion was to introduce the Bill in the House of Lords rather than in the House of Commons? Does he not recognise that the Bill as now drafted clearly removes the incentive for people to take out policies with prudent companies? It is not only a question of protecting policyholders, which is clearly important; it is a question of which policyholders are being protected. It removes the incentive for people to select firms which are prudent and will lead to a situation in which the only thing people are concerned about is the lowest premium or the highest benefit, regardless of the risk involved, because they know that the Government will bail them out.

Mr. Shore: I understand the problem, but the difficulty that we have to confront is that any scheme put forward for insuring policyholders from the consequences of the collapse of an insurance company contains the danger of removing the fear

of unwise investment. Of course there is that problem. But I think that the right answer is not to say "caveat emptor", because one is dealing with many people of only modest resources, who have not necessarily got the best advice, and when they obtain advice it is often mistaken advice. That is not the right advice to give. What the hon. Gentleman should be urging me—which I should be willing to accept—is to develop and use the powers for regulating the industry which I have under the previous Conservative Government's 1973 Act, to do my utmost to see that insurance policies and insurance companies are properly and prudently managed.

Oral Answers to Questions — European Free Trade Area

6. Mr. Shepherd: asked the Secretary of State for Trade what recent official consultations he has had with the Governments of the members of EFTA.

12. Mr. Hurd: asked the Secretary of State for Trade what recent meetings he has had with Ministers of Trade of EFTA countries.

Mr. Shore: I visited Sweden and Finland officially in January, where I had talks with the Prime Ministers of each country and with the other Ministers and senior officials most closely concerned with foreign trade.

Mr. Shepherd: Will the right hon. Gentleman explain what advantages not produced by EEC membership a free trade agreement with the other eight countries would provide for our trade balance with other EEC countries?

Mr. Shore: I am surprised at the hon. Gentleman. I think that I have answered that question on other occasions. To many people, the obvious attraction of a free trade agreement as distinct from membership of the Common Market is that most free trade agreements are limited to industrial goods. That for Britain, as the major food-importing country of Western Europe, has certain obvious advantages.

Mr. Hurd: Does the Secretary of State recall putting his name to a document not long ago in which he suggested that within six months of breaking our treaty with the Community we would be able to negotiate with the Common Market


a new free trade arrangement which would give us all the benefits of membership without having to accept any of the infringements on sovereignty which Norway, Sweden, and other EFTA countries have had to accept? The right hon. Gentleman must have had some evidence for that rather strange assertion. Will he tell us what it was?

Mr. Shore: I think that in negotiating with the EEC after 5th June there will inevitably be an element of uncertainty. Nobody would deny that. We were putting forward what appeared to us to be a reasonable timetable which would allow us to negotiate alternative arrangements and to unscramble the omelette over a period and in a reasonable way—that is, between June and 1st January 1976.

Mr. Flannery: Does my right hon. Friend agree that when the referendum eventually takes us out of the Common Market we shall be able to trade freely with both the EEC and EFTA countries, to the benefit of us all?

Mr. Shore: I have no question in my mind but that that will be the aim and purpose of the denegotiation which we shall start should the British people vote "No" on 5th June.

Oral Answers to Questions — European Community

. Mr. Marten: asked the Secretary of State for Trade to what extent entry into the Common Market has had a positive or substantial effect on the United Kingdom's balance of trade.

Mr. Shore: While it is not possible to identify with certainty the effect that entry into the Common Market has had on our balance of trade, the deficit with the EEC has substantially worsened.

Mr. Marten: Does the right hon. Gentleman recall that in paragraph 45 the 1971 White Paper produced by the previous administration said that they were absolutely confident that the effect on our balance of trade would be positive and substantial?

Mr. Biffen: For a short period.

Mr. Marten: It did not mention a period.

Mr. Biffen: In the long term.

Mr. Marten: It did not mention that. If the judgment of the pro-Marketeers was so wrong in this as in so many other matters, is there any reason why their judgment should be valued when they say that we shall be isolated if we come out?

Mr. Shore: I find the more extreme claims of the pro-Marketeers very difficult to take seriously, particularly, as the hon. Gentleman rightly recalls, in the light of the very strong claims which were made about the alleged benefits that Britain would have from the EEC in the 1971 White Paper which have been seriously disproved by the actual experience of membership.

Mr. Jay: Does my right hon. Friend see any evidence that the position is improving as we proceed from the short towards the long term?

Mr. Shore: No, Sir. The fact of the matter is that there has been a progressive deterioration in our balance of trade with the EEC. The £2,000 million deficit that we chalked up in 1974 is running at a rate of £2,400 million in the first quarter of 1975.

Mr. Higgins: In view of the blatant innuendo in the right hon. Gentleman's reply, should not this question have been transferred? Does he accept that to quote the figures for the deficit without putting them in the context of Britain's overall deficit is grossly misleading?

Mr. Shore: I shall reply to the only serious point made by the hon. Gentleman. It is instructive to look at the matter in the context of our overall deficit. The House must know and face the fact that, apart from the oil trade—which I willingly concede is the major and appalling problem that we face—on the balance of payments basis we are virtually in balance with the rest of the world. On the best available figures, 99 per cent. of our non-oil deficit is now attributable to trade with the EEC.

. Mr. Tebbit: asked the Secretary of State for Trade how many questions concerning the responsibilities of his Department in relation to the EEC have been transferred to other Departments or to other Ministers in his Department.

Mr. Shore: None, Sir.

Mr. Tebbit: Does the right hon. Gentleman think that it might be a good idea to start pretty soon? In fact, it might have been a good idea to start earlier today. In answering my hon. Friend the Member for Mid-Oxon (Mr. Hurd) and expressing the belief that it would be possible to negotiate a satisfactory free trade agreement with the EEC after the breach of the Treaty of Rome, the right hon. Gentleman used the word "we". Who is "we"? Is it Her Majesty's Government, or is it some little group inside the Government, or is it the anti-Market group? Should not the right hon. Gentleman use the word "we" at the Dispatch Box only when referring to Government policy?

Mr. Shore: When I am speaking from the Dispatch Box I am reflecting Government policy as a whole, except when I am clearly reflecting my own policy as the Secretary of State for Trade.

16. Mr. Tim Renton: asked the Secretary of State for Trade what evidence he has that the EEC would be as willing to enter into free trade, arrangements with 2 developed country of 50 million people as with countries of 5 million.

Mr. Shore: Evidence in advance of negotiations is never available. However, the EEC can be expected to consult its own interests in devising alternative trade arrangements if we withdraw.

Mr. Renton: Does the right hon. Gentleman remember that the Lord Chancellor, leading for the Government in another place on 21st April, said:
…there is no certainty that we would be able to negotiate a free trade agreement."— [Official Report, House of Lords, 21st April 1975; Vol. 359, c. 603.]
When the Secretary of State sees Britain outside the EEC as a free trading self-sufficient island, is he not in danger of suffering the fate of the dormouse at the Mad Hatter's tea party?

Mr. Shore: We are discussing a situation about which, at the moment, we can form only reasoned views. There may be different views about the nature of a free trade agreement, and how satisfactory it might be, if we were to withdraw from the Common Market, but I am not aware of any serious body of opinion which doubts that we can conclude a free trade agreement with the EEC.

Mr. Wellbeloved: Will my right hon. Friend refrain from wasting too much time on giving consideration to what we do after 5th June? In order to make it possible for him to reflect his own views, based on a greater degree of fact, will he consider visiting Brussels and joining in the desperate search for a trade unionist or a Socialist from one of the original six members of the Community who is prepared to recommend to his own country that it should leave the EEC?

Mr. Dykes: asked the Secretary of State for Trade what is his latest assessment of the effects on United Kingdom trade that would arise from withdrawal from the European Economic Community.

Mr. Brittan: asked the Secretary of State for Trade what is the latest assessment his Department has made of the consequences for trade of British withdrawal from the EEC.

Mr. Shore: The Government's assessment is set out in paragraphs 146–149 of the White Paper on Membership of the European Community (Cmnd. 6003).

Mr. Dykes: Will the Secretary of State give a solemn promise now to give a straight factual answer to the House and say what the figure would be if he added up all our net non-oil deficits with all the countries with which we trade, in comparison with the non-oil non-food deficit with the EEC countries?

Mr. Shore: That is an interesting new possibility. I shall be very pleased to write to the hon. Member. I shall certainly look up those figures for him and let him have a reply.

Mr. Brittan: Does the right hon. Gentleman agree with me that the important factor is the effect of the reimposition of the common external tariff if we were to leave the Community? Does he not agree that unless adequate attention is paid to that factor, no realistic assessment of what will happen can possibly be given?

Mr. Shore: I agree that the common external tariff would be an important factor. That is why any subsequent negotiations to reach agreement on both sides


so that trade is not hindered either from the EEC to Britain or Britain to the EEC should work to that end.

Mr. Spearing: Does not my right hon. Friend agree that, whatever the importance of the common external tariff, there are many other factors of considerable importance, since we had a positive trade balance of some significance prior to entry? Will he undertake to give the House—or will he give me, in writing—some of the other factors of significance, for instance, delivery dates and quality, which enabled us to have a favourable trade balance before we entered the EEC?

Mr. Shore: Many factors are involved —and in my view they are substantial—in the unhappy development of our trade deficit with the EEC. I shall certainly consider my hon. Friend's invitation, but I have no doubt that at the end of the day an analysis would lead us back to the need for making substantial changes in the efficiency, productivity and capacity of British industry.

Mrs. Kellett-Bowman: Is the right hon. Gentleman aware that Lancaster, which has almost double the national rate of unemployment, does well over 20 per cent. of its trade with EEC countries and that that proportion is rapidly increasing? Is he aware that there is widespread anxiety among employers and workers alike about what would happen in the unlikely event of our withdrawing from the EEC? Is he aware that it is not just the common external tariff but the myriad other arrangements with EEC countries that now make it extremely difficult for countries outside to trade with the EEC? For instance, although Sweden and Norway have an arrangement, they are entirely excluded from these consultations.

Mr. Shore: I am sorry to hear about the unhappiness of the people of Lancaster. Quite apart from the matter that the hon. Lady has mentioned, tariff barriers, and the like, there is not only the forum of Brussels to discuss these matters but the broader forum of the multilateral trade negotiations that are now taking place and that seem to resolve these matters on a broader international basis.

Oral Answers to Questions — Northern Airport Study

. Mr. Wrigglesworth: asked the Secretary of State for Trade if he will make a statement on the comments submitted to him by the Civil Aviation Authority on the Northern Airport Study.

The Under-Secretary of State for Trade (Mr. Clinton Davis): I refer my hon. Friend to the replies given to him on 28th April—[Vol. 891, c. 27]—and to my hon. Friend the Member for Stockport. North (Mr. Bennett) on 16th April.—[Vol. 890, c. 131.]

Mr. Wrigglesworth: I thank my hon. Friend for that not entirely unexpected reply. Recognising the anxiety felt in many areas because of the conflicting evidence coming from the Civil Aviation Authority and the independent study of the Northern Region, will he tell us when he proposes to publish his consultative document and when the Government intend to decide what their policy shall be?

Mr. Davis: There are two consultative documents. One is on the London area airports, which we hope will be published before the Summer Recess. My right hon. Friend hopes to make a statement at the same time.
The consultative document on the regional airports will be published some months later than, but we hope not too long after, the original consultative document on the London airports. In both cases there will be a period of discussion with the local authorities and other people concerned. That will probably extend over a period of six months. The Government will then make their decision. However, it is most important that we should have a clear and detailed discussion with the authorities concerned after publication of both consultative documents.

Mr. Brittan: While appreciating the need for a full discussion on these matters, may I ask whether the hon. Gentleman accepts that there is a certain urgency concerning the North-East, particularly as Teesside is the major centre for North Sea oil? It is a matter of great national importance which is


dependent on having adequate facilities, including airport facilities, in the areas covered by industries getting themselves ready for the coming in of North Sea oil.

Mr. Davis: We are well aware of the urgency of the matter and of the considerations referred to by the hon. Gentleman. It would be wholly wrong for us to engage in a truncated form of discussion. It is most important that everyone who has a voice to be heard in this matter should have an opportunity of expressing views to the Government, and that the Government should then make up their mind. It is a great pity that the previous Government did not exercise the same care as we have exercised over this vital matter of national policy.

Oral Answers to Questions — Aircraft Noise

. Mr. Jessel: asked the Secretary of State for Trade what further action he intends to take to reduce nuisance from aircraft noise.

Mr. Clinton Davis: My intention is to seek, by all practicable means, a progressive reduction in disturbance from aircraft noise, and I therefore keep noise abatement measures under continuing review.

Mr. Jessel: In view of the suffering that aircraft noise causes, will the Government step up their action to deal with it? Would it be possible to provide some form of strong financial inducement to airlines to step up the pace at which they are using quieter aircraft engines—for example, by having differential landing charges, with heavy charges for the noisiest aircraft, the proceeds being used to reduce the rates in the areas affected by noise.

Mr. Davis: The differential system to which the hon. Gentleman alludes would require the most careful consideration. This does not represent the surest way of effecting the sort of balance that we want to achieve in dealing with aircraft noise.
The hon. Gentleman says that we should step up our action. He knows very well that over the past year the Government have taken clear action to deal with this matter. At Heathrow and Gatwick we have introduced measures which will abate noise considerably. We have under active consideration the ques-

tion of division of the Mole Valley route, and I hope to be able to make a decision on that within the next few days; but new, quieter aircraft are the real answer to this problem, and these are being introduced. The hon. Gentleman is well aware of the steps that we have taken.

Oral Answers to Questions — Brussels

. Mr. Blaker: asked the Secretary of State for Trade if he will pay an official visit to Brussels.

. Mr. Pardoe: asked the Secretary of State for Trade if he has any plans to visit Brussels.

Mr. Shore: My practice has been, and remains, to go to Brussels as often as is necessary when matters for which I am responsible are under discussion.

Mr. Blaker: Has the right hon. Gentleman had any discussions with Ministers of the other EEC countries about the possibility of their agreeing to a free trade area with this country if we were to pull out of the EEC? If so, has the right hon. Gentleman any evidence that they would not insist on including food in any such agreement, which I believe was their position in the late 1950s?

Mr. Shore: If I were to report to the House that I had had discussions with other Ministers in the Council of Ministers I think that a lot of complaints would be heard that I had been exceeding my brief. I am afraid that I have not yet had the opportunity of embarking upon such discussions, but I do not take the view that we should, as it were, have to bring ourselves into the CAP—if that is the implication of the hon. Member's question—if we were simply negotiating a free trade area with the EEC.

Mr. Pardoe: Is the right hon. Gentleman really saying that if we come out there is an alternative to the EEC in the form of a free trade agreement in industrial goods, without the benefit of having been to Brussels to get a categorical assurance from our partners there that this is so? Will he, as a result of recent visits to Brussels, say which parts of the Treaty of Rome have had to be accepted by other EFTA countries which have succeeded in negotiating free trade agreements with the EEC?

Mr. Shore: I can tell the hon. Gentleman what they have not had to accept, which may be important. I am not aware of any budget contributions which EFTA countries which have free trade areas with the EEC have been obliged to make. Nor am I aware of any agreement which they have had to make about the free movement of capital, and I can think of a few others.
On the last question, I quote an answer given in the House:
I have never doubted—indeed, I have always said—that if we were to leave the Community we would be able to negotiate a free trade agreement of some sort."—[Official Report, 30th April 1975; Vol. 891, c. 461.]
That was said by my right hon. Friend the Foreign Secretary in reply to a question only a few days ago. I think that we had better leave it at that.

Mr. Spearing: When my right hon. Friend next goes to Brussels will he try to find out that proportion of our trade deficit which is attributable to the accessionary compensatory amounts which we now pay for food but which will be phased out in 1976, and sums such as the £16-a-ton subsidy which we are getting on grain imported from North America? Will not this mean that our deficit will rise after this stops?

Mr. Shore: I think that the position of our deficit is less certain, but it is undoubtedly true that as the accession compensatory amounts are phased out prices will automatically rise in the United Kingdom on all the food commodities which we import from the EEC.

Oral Answers to Questions — Oil (Imports)

14. Mr. Edwin Wainwright: asked the Secretary of State for Trade how many tons of oil were imported into the United Kingdom during each of the past five years; and what was the cost in each case

Mr. Deakins: I am circulating in the Official Report a table showing the figures requested. The figures show that the balance of payments cost of our oil imports in 1974 was nearly five times what it was in 1971.

Mr. Wainwright: In view of the figures which my hon. Friend has just given may I ask whether he has taken into account what occurred in 1973 with the

oil supplying countries, and the fact that some disturbance in that area—which we hope there will not be—could have the effect of aggravating the present oil situation? Will he bear in mind that plans must be made immediately to speed up the supply of oil from the North Sea and also to make the mining industry more viable, by further massive investment?

Mr. Deakins: These are matters for my right hon. Friend the Secretary of State for Energy, but I assure my hon. Friend that the Department of Trade is anxious to make the best use, as quickly as possible, of the vast energy resources which are being discovered both under the sea and under the land in Britain.

Mr. Adley: In view of the answer which the Minister has just given to his hon. Friend the Member for Dearne Valley (Mr. Wainwright), will he confirm that he accepts in full the implications of the speech made in his constituency during the weekend by his right hon. Friend the Secretary of State for Defence?

Mr. Deakins: I have seen only newspaper reports of my right hon. Friend's speech, in which he spoke about needing a market for coal. I believe that we shall need markets all over the world for any surplus energy that we have. I know of no industrial nations in the world which insist on placing tariffs on raw material imports for their manufacturing production.

Mr. Skinner: Does my hon. Friend realise that, notwithstanding his efforts to try to cut down the massive oil import bill, right under his nose, almost, there are dual-fired power stations using both coal and oil? The coal-fired power stations are being run down and closed temporarily, while the oil-fired stations are using oil which is live times as expensive as coal. Should not this matter be dealt with? My hon. Friend may say that this is a question for another Department, but surely he appreciates that he must do something about a matter of such grave importance as this.

Mr. Deakins: My hon. Friend has raised an important point and I shall see that his observations are brought to the attention of my right hon. Friend the Secretary of State for Energy who, within


the Government, must take the lead on a matter such as this.

The information is as follows:—

IMPORTS OR PETROLEUM AND PETROLEUM PRODUCTS



Quantities million tons
Values fob £million


1970
122
655


1971
127
862


1972
125
877


1973
133
1,281


1974
127
4,142

Oral Answers to Questions — London Counties Securities Limited

Mr. Skinner: asked the Secretary of State for Trade whether he has now fully considered the report of his Department's investigations into the London Counties Securities Limited.

Mr. Clinton Davis: I have not yet completed my consideration of this lengthy and complex report.

Mr. Skinner: My hon. Friend is taking a long time and it is probably costing a lot of money. Does he appreciate that some of us on the Government side are rapidly concluding that this matter, like many other unpleasant facts, is being swept under the carpet until after referendum day, so as to save the Liberal Party and the Liberal leader some embarrassment?

Mr. Davis: I do not think that, on reflection, the hon. Member would have said that—

Mr. Skinner: Yes I would.

Mr. Davis: I have no intention of sweeping anything under the carpet until referendum day, nor has my right hon. Friend. When this report—[Interruption.] The hon. Member for Christchurch and Lymington (Mr. Adley) interrupts constantly from a sedentary position. He would be better off going back to the place where he obtained his suntan over the weekend.
The report that we have is lengthy and complex. It runs to several hundred pages and covers the activities of 20 subsidiary companies. It is taking me a great deal of time to study it so as to arrive at the statement that we shall make. I hope to be able to be more forthcoming when the hon. Gentleman puts down his next Question on the next day that my Department is first to answer Questions. It is important that

the hon. Gentleman should understand—

Mr. Skinner: I am your hon. Friend.

Mr. Davis: It is important that my hon. Friend should understand that this is a sensitive and difficult matter. I hope that he will not continue to draw the sort of inferences that he has chosen to draw today.

Oral Answers to Questions — Sweden

Mr. Spicer: asked the Secretary of State for Trade if he will pay an official visit to Sweden.

Mr. Shore: I made an official visit to Sweden on 14th and 15th January last. I have no present plans for a further visit.

Mr. Spicer: I thank the right hon. Gentleman for that reply. During that visit, was he able to speak to those people in the Swedish steel industry who are concerned with exports of Swedish steel to within the EEC? Did they express their concern at the fact that all the pricing and quota agreements for Swedish steel are laid down by the Community and that only after that system has been laid down are the Swedes invited to enter to be informed of the result of the discussions within the EEC?

Mr. Shore: I note what the hon. Member says. I do not recall this matter being raised with me in what was inevitably a fairly brief visit to the Swedish company. I suppose that if it had been at the top of their minds and had been a matter of great concern to them, I should have heard about it.

Oral Answers to Questions — Woollen Goods (Imports)

.Mr. Cronin: asked the Secretary of State for Trade if he will make a statement on quota levels for low-cost woollen imports from Hong Kong, Taiwan and South Korea; and how he expects them to affect the knitwear industry in Leicestershire.

Mr. Deakins: There are no quotas at present but restraints will be imposed when negotiations between the EEC and Hong Kong and South Korea under the multifibre arrangement are concluded. Similar arrangements will be negotiated with Taiwan. The effect of the restraint


together with the Community's burden-sharing formula, will be to ensure that knitwear imports can increase only very gradually.

Mr. Cronin: Will my hon. Friend consider sending one of his officers to Leicestershire to discuss this matter with representatives of the hosiery industry, because it is causing great disquiet?

Mr. Deakins: We have had a number of representations, of course, not only from the hosiery industry and from local Members of Parliament on both sides, working in their constituents' interests, but also from the British Textile Confederation. I assure my hon. Friend that these representations arc being urgently considered.

Mr. Richard Wainwright: Did te hon. Gentleman's original answer cover made-up, tailored woollen garments from these countries, the flood of which into this country is causing great disruption?

Mr. Deakins: My answer covered knitted clothing and hosiery—knitted jumpers, pullovers, cardigans and things like that.

Mr. Ford: Nevertheless, I hope that the Minister will carry from the woollen textile industry to his right hon. Friends the message that it is extremely concerned about imports of made-up clothing and the fact that the Government have not included it among their surveillance activities. Is he aware that there is a rumour that the Government are considering selective action between the cotton and woollen textile industries, and that this would be greatly regretted in woollen textile circles?

Mr. Deakins: I am aware that virtually the whole industry—woollens and cottons, made-ups and raw materials—is in serious difficulties. The Government are urgently and sympathetically considering what can be done—particularly, what further action can be taken to help all sections of the trade

Mr. Fletcher-Cooke: What is the timetable as regards the multifibre arrangement? When can we expect some finality on that?

Mr. Deakins: If the hon. and learned Gentleman is referring to the particular restraint negotiations which are currently going on among the Community, Hong

Kong and South Korea, these will obviously be concluded as quickly as possible. It is not for Britain to say when they should be concluded, but we are associated with those agreements and we want to see them concluded as quickly as possible—as I am sure do other textile-producing members of the Community.

Mr. McCusker: Can the hon. Gentleman give us details of the new French proposals to control imports into that country? Does he intend to implement similar legislation here?

Mr. Deakins: I am sorry; I cannot give the details because I do not know about them yet. We shall obviously get a report from our commercial counsellor at the embassy in Paris on the implications of what the French are doing, and certainly we shall look closely at what our industrial competitors in Western Europe are doing to deal with a problem which affects them as much as it does us.

Oral Answers to Questions — COMECON Countries

Mr. Lane: asked the Secretary of State for Trade what recent contacts he has had with COMECON countries for trade purposes; and with what results.

Mr. Deakins: I and my Department have regular and continuing contacts on trade matters with all the COMECON countries. Eastern Europe including the USSR provides a growing market. Our exports there last year increased by 33 per cent. compared with 1973.

Mr. Lane: As the Secretary of State was reported as saying that, in the unlikely event of Britain leaving the Common Market he looked forward to negotiating new trading arrangements with COMECON, is there some specific undertaking to this effect? If there is not, how can his right hon. Friend possibly think that more trade with COMECON could be any substitute for less trade with the EEC?

Mr. Deakins: I do not think that my right hon. Friend or I intend that less trade with the EEC should be the outcome of the referendum, whichever way it goes. Certainly British industrialists will be wanting to sell their goods in all parts of the world—not just in the Common Market, not even just in COMECON. Whatever the outcome of the referendum,


I hope that, to get the country out of the severe balance of payments problem which we face, our industrialists who have not previously considered exporting will look carefully at all parts of the world to decide which parts of the market can offer the best potential for increasing their exports.

Mrs. Colquhoun: Is my hon. Friend not aware that British footwear workers are increasingly on three-and-a-half and four-day working weeks, and that they are eagerly awaiting a Government statement on import quotas for COMECON countries? Can he say when that statement can be expected?

Mr. Deakins: I cannot say exactly when, but negotiations have been going on for some time with the countries concerned as a continuation of an antidumping application made a year or two ago. As a result of our preliminary negotiations with those countries, we have gone back to them to try to get rather more concessions, and I am hopeful of the outcome. As soon as we have reached finality with the three countries concerned, we shall report to the House what has been achieved. I do not think that my hon. Friend will be at all dissatisfied.

Mr. Shersby: In view of the Minister's previous answer, does he agree that British manufacturers are being encouraged to export woollen textile machinery to the Soviet Union for the modernisation and reconstruction of the Soviet textile industry? Is he satisfied that this action, which is taking place at low interest rates, protected against inflation, will not result in further competition for our own industry?

Mr. Deakins: That may well be the outcome, but I invite the hon. Member to think seriously about the implications of what lie has said, because we are exporting machinery all over the world to build up nascent and small industries that eventually may prove to be the competitors of some of our traditional industries. But what is the alternative? Not to export machinery? In that case our competitors will certainly do so. We believe in multilateral trade, and we have to export what we are best able to export. If, for some of our industries, there are any consequent problems in a year or

two, or in 10 years, we must take appropriate measures to ensure that they are not harmed.

Oral Answers to Questions — International Air Transport Association

Mr. Neubert: asked the Secretary of State for Trade what plans he has to make an official visit to the headquarters of the International Air Transport Association in Montreal.

Mr. Clinton Davis: My right hon. Friend has no plans for an official visit to the headquarters of the International Air Transport Association in Montreal.

Mr. Neubert: If not in person, will the Minister by letter urge IATA to impress on its member airlines how much better it would be to come forward with a simplified structure of realistic fares rather than to allow the present anarchy of a commission war and under-the-counter discounted fares which has created a bonanza for the bucket shops and which is undermining legitimate interests?

Mr. Davis: I am well aware of the present difficulties, which have been precipitated by PanAm. The hon. Member will be pleased to know that my Department wrote to PanAm on 23rd April asking it to give specific and satisfactory assurances following its unfortunate initiative. Unfortunately, it has not yet given those assurances, and that could —I hope that it will not, but it could—lead to a possible revocation of its operating permits in this country. We want order in this situation, and the hon. Member may rest assured that the Government will continue to use their best endeavours to achieve that objective.

Oral Answers to Questions — Arab Countries (Boycott)

Mr. Leslie Huckfield: asked the Secretary of State for Trade whether he will make a further statement on his policy on the Arab trade boycott.

Mr. Deakins: As Her Majesty's Governments of both parties have stated from time to time, they are opposed to and deplore all trade boycotts other than those internationally supported and sanctioned by the United Nations. The Arab boycott of Israel is one element in the conflict between Israel and the Arab States. Her Majesty's Government support all positive


measures aimed at the peaceful resolution of that conflict. In the meantime, British exporters may raise with my officials any boycott problems they face, when they will be given the benefit of their knowledge and experience. How exporters act in particular cases must, however, remain a matter for their commercial judgment.

Mr. Huckfield: I thank my hon. Friend for that reply. Is it possible to make it even more clear to British firms that they do not have to succumb to pressure and tactics of this kind? Will my hon. Friend now seriously consider the possibility of setting up some kind of information office to which British firms have to have recourse if they are approached by the Arab Boycott Office in this country or in other countries?

Mr. Deakins: I do not think that that would have the effect that my hon. Friend wishes. In the United States there is legislation more or less to this effect, but I do not think that the existence of legislation in the United States, or, for that matter, the existence of an information office in this country, would prevent American exporters or British exporters from complying with a boycott if it were in their commercial interests to do so. In the last resort we must have regard to the interests of the firms themselves and leave it to them to make their own decisions in the light of all the circumstances.

Oral Answers to Questions — Russia

Mrs. Renée Short: asked the Secretary of State for Trade what priorities in Anglo-Soviet trade he will be discussing during his forthcoming visit to Moscow.

Mr. Shore: The main priorities will be to identify specific export opportunities on which British companies can concentrate their attention, and to agree a programme of trade promotional activities for the next 12 months.

Mrs. Short: In view of the need to develop our trading potential with other countries, I am sure that the whole House would like to wish my right hon. Friend well. However, will he take on board the opportunities for the construction industry, in that the Soviet Union is now anxious to build a large number of 1,000-bed hotels for the coming Olympics, which are to be held in the Soviet Union? Is he aware that French and Swedish con-

struction firms already have contracts to build three of these large hotels in Moscow and Leningrad? Is it not time that some of the British firms showed some interest in these tenders?

Mr. Shore: I agree with my hon. Friend that there are many opportunities for fruitful and useful business with the Soviet Union. I have always taken the view that, considering the economic bases of our two countries, the level of trade was almost pathetically small, and certainly a good dealer smaller than our trade with Poland, for example. However, I shall be looking at all these matters. I have very much in mind what we can do to identify the areas where we can increase exports, and I shall certainly do all that I can to help to that end.

Sir Frederic Bennett: Will the right hon. Gentleman remind the House of the present figures for the balance of trade between the Soviet Union and this country? Is it favourable or otherwise? Will he also remind us of the last time when such trading has been favourable? As for these hotels being built in the Soviet Union, will the right hon. Gentleman tell us whether they are being built for cash or long-term credit?

Mr. Shore: I believe that the previous supplementary question referred to hotels being built by French companies. I cannot tell the hon. Gentleman what arrangements were made between the French and the Soviet Governments for financing these hotels. The hon. Gentleman is right to suggest that we have traditionally had an unfavourable balance of trade with the Soviet Union. It was of the order of £280 million in 1974.

Oral Answers to Questions — QUESTIONS TO MINISTERS

Mr. Blaker: On a point of order, Mr. Speaker. May I refer to an answer which the Secretary of State gave to a supplementary question of mine on Question No. 11?

Mr. Speaker: Order. Is it a point of order about the content of the reply?

Mr. Blaker: It is a point of order about the quotation which the Secretary of State attributed to the Minister of State. I contend that he should have quoted the whole of—

Mr. Speaker: Order. I am sorry but I nave ruled on this again and again. The content of an answer is not a matter of order for the Chair.

Mr. Hurd: On a point of order. Mr. Speaker. Could I ask for your help on a point which relates not to the content of an answer but to the fact that the Secretary of State specifically said that he was giving answers which reflected Government views except on those occasions when they reflected his own views? Is this—

Mr. Speaker: Order. This point has been made to me several times already. I have ruled on it again and again. How Ministers decide to answer Questions is not a matter for the Chair. Nor is what they say. Whether it is a matter for relief is another matter but it is not for me to say. It is certainly not a matter of order. provided that the Minister uses parliamentary language, which he did.

Mr. Higgins: On a point of order, Mr. Speaker. May I have your guidance? On occasions when the Minister totally

fails—as he did in answer to his hon. Friend the Member for Erith and Cray-ford (Mr. Wellbeloved)—to answer a question dealing with the EEC, are we to assume that there is neither a Government view nor the Minister's personal view on the matter?

Mr. Speaker: No. The hon. Member has been in this House long enough to know that that is a bogus point of order.

STATUTORY INSTRUMENTS

Ordered,
That the Legal Aid (Scotland) (Financial Conditions) Regulations 1975 be referred to a Standing Committee on Statutory Instruments.
That the Legal Advice and Assistance (Scotland) (Financial Condiions) (No. 2) Regulations 1975 be referred to a Standing Committee on Statutory Instruments.
That the Legal (Financial Conditions Regulations 1975 be referred to a Standing Committee on Statutory Instruments.
That the Legal Advice and Assistance (Financial Conditions) (No. 2) Regulations 1975 be referred to a Standing Committee on Statutory Instruments.—[Mr. Dormand.]

Orders of the Day — SUPPLY

[16TH ALLOTTED DAY],—considered.

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Dormand.]

Orders of the Day — EMPLOYMENT (SCHOOL LEAVERS)

3.33 p.m

Mr. James Prior (Lowestoft): My right hon. and hon. Friends and I thought that for the first half of this afternoon we might enjoy a fairly quiet debate on the subject of the employment problems and prospects for school leavers. We have tabled this short debate on the Adjournment so that we can discuss these matters in perhaps a quieter and more conciliatory atmosphere than sometimes prevails. This is a particularly important subject at present when unemployment is rising.
The problems of school leavers are part of the wider unemployment problem. We all know from experience, certainly from evidence that has recently become available, that school leavers will bear the brunt as the unemployment situation worsens. I refer here to a recently published document from the working party set up under the National Youth Employment Council entitled "Unqualified, Untrained and Unemployed". The document says that all experience points to the fact that at each stage in the economic cycle since 1961 the recovery in youth employment has been less with each upturn and has been steeper with each downturn. The only slight improvement in the graph came as a result of the raising of the school leaving age in the summer of 1973.
Since 1961 levels of unemployment among school leavers have been considerably higher. When total unemployment increases, unemployment among young people rises more rapidly. When total unemployment falls, the recovery in respect of young people is slower. There are numerous reasons for that. I will pick out a few. When companies get into difficulty the first thing they do is to suspend recruitment. Young people

by their nature are in and out of jobs more often and are perhaps more vulnerable during a time of recession. They are naturally restive, and this creates greater problems.
There is a new factor coming into the picture which has been particularly emphasised by American experience. It is that as the gap between wage rates paid to young people and those paid to the rest of the working force narrows, the advantages of employing young people diminish, with the result that they have more trouble in getting work. I do not say that this is a reason for paying young people less well, but it is another factor to be taken into consideration.
At present unemployment is rising rapidly, but, unlike some other periods of recession, we have so far avoided large-scale redundancies. This is partly because companies have not had the cash to meet redundancy payments and partly because they have decided to use natural wastage to reduce their labour force. Where there is great investment taking place, fewer jobs will be lost. That is bound to affect the recruitment of new labour.
It seems that July, August and September will see a serious situation for school leavers, far more serious than at any time since the war. The Inner London Education Authority and other bodies are worried about this. In addition, the bulge of school leavers is coming to the fore and the numbers in the 15 to 17 age range will increase from about 2 million last year to about 2,750,000 in five years' time.
Which school leavers suffer most? Generally speaking, it is those of lower educational attainment. Coloured children in particular may be especially vulnerable as a result of language difficulties, educational attainment, background and even prejudice. We are talking about the disadvantage, and undoubtedly these people are the last to gain employment and the first to be made unemployed when the going gets tough. In such cases we can and do create an embittered group, of limited value to society. This, again, was brought out forcibly in the document "Unqualified, Untrained and Unemployed".
A survey conducted under the auspices of the National Youth Employment Council showed that in 1972, 70 per cent, of


unemployed young people were below CSE grade 3 level and were, therefore, unqualified and untrained and likely to obtain jobs below craft level. It is for them that the jobs dry up quickest. When an employer finds the going tough, he does not employ someone to make the tea or do the odd jobs. Those are the types of job that some of the unqualified would expect to get, but they dry up first.
For many young people there is a choice this year between staying on at school for a further year and taking a chance on the labour market. If they take a chance on the labour market, they may become unemployed or they may drift from job to job.
This is a social situation which should not be tolerated. It can lead to delinquency and moral degradation, and a legacy of a deep recession such as we are beginning to see can remain for ever.
Higher levels of unemployment are now probably inevitable. It is, therefore, even more important that we do everything we can to help the young. Those who speak about unemployment—I am talking now in general terms—should always recognise what unemployment can do to sap dignity and social wellbeing of individuals as well as of the nation as a whole. No one should regard unemployment as a proper or easy way out of a nation's problems. We shall admit defeat if we say that the only way in which we can deal with our problems as a nation is by causing and accepting high levels of unemployment.
Today, however, we are not discussing that problem. We are concentrating particularly on the problems of the young school leaver. I want to discuss what the Government should do. In other periods of the trade or economic cycle, reflation is one of the ways in which unemployment can be reduced. Obviously that is not an option which is open to the Government at present. It is a reflection of the seriousness of the situation that, even when unemployment is rising rapidly, we see the turn of interest rates as exemplified by the raising of the minimum lending rate on Friday. If the debate helps to awaken people to what is happening in the economy in a general way, as well as to what is happening to young school leavers. it will have served a purpose.
The Manpower Services Commission, in its 1974–75 annual report, makes certain proposals to the Secretary of State for work creation. I hope that we shall hear today what has happened, and how the proposals in the Budget Statement impinge on work creation.
On 22nd April, in answer to a supplementary question on unemployed young persons by my hon. Friend the Member for Kidderminster (Mr. Bulmer), the Under-Secretary said:
A great deal is being done."—[Official Report, 22nd April 1975; Vol. 890, c. 1214.]
I hope to show that much remains to be done.
It seems from the Manpower Services Commission outline strategy that large-scale training effort was to be directed not so much at school leavers, as at those between 24 and 55. That seems to be borne out by what the Chancellor said in his Budget speech. We should like to know whether the money which the Chancellor has rightly allocated for additional training in the coming year and in 1976–77 is to be allocated to help the youngsters as well as that age group which the Manpower Services Commission has selected as being in need of large-scale training.
What alternatives are available to youngsters? They can stay on at school. More will undoubtedly do so. It is very important, if they are to stay on at school, that the schools should make a proper job of looking after them for the extra year. This will mean, amongst other things, paying much greater attention to careers education and ensuring that the curricula are devised in the best fashion to equip young people for the world in which they will have to work.
There should perhaps be more courses, not necessarily in school, but linked courses, and further developments of the work experience scheme. There seem to be divided views on whether the last year at school, whether it is from 15 to 16 or, as it might be this year, from 16 to 17 for some youngsters, is a wasted year and whether the youngsters just become truants. The majority will obviously want to make the best use that they can of the extra year at school. It is surprising how many are still illiterate and innumerate. If they are to stay on


for the extra year, perhaps more attention can be paid in school to literacy and numeracy.
As regards training for youngsters who leave school, the House should accept the recommendation from the National Youth Employment Council that training opportunities should be available for all young people who need them. A young person of low educational attainment may benefit most from a suitably designed training programme.
The pamphlet "Unqualified, Untrained and Unemployed" makes some useful suggestions and recommendations about training which should be carefully considered by the Government. For example, its recommendations include,
improve the quality and quantity of training available to young people seeking jobs below craft level; make the Government's training contribution for young people more flexible so as to meet the needs of high unemployment areas and to be capable of extension in times of recession …ensure that craft apprenticeship training is not reduced because of short-term economic considerations.
Have the Government reached any conclusions about these important matters?
There is the Trident scheme, combining work experience, community service and self-fulfilment. Community service can have a lasting benefit. I quote one paragraph from a letter I recently received on the subject of community service:
Now what have we learned from this experiment? We find that much of the apparent truculence or apparent sullen apathy of these young people often arises from their inability to communicate, from having had a lack of concerned adults with whom they form normal social and working relationships. We find that the most cack-handed youngster can, with patience, surprise all of us with his developing ability. We find that once he feels he counts as a member of a production team his level of self-pride and his level of commitment to the job rises beyond all expectation.
And perhaps therein lies the clue. It is when he feels he counts, when attitudes are displayed to him which demonstrate that he is not just the lowliest cog in the industrial machine—then he begins to believe in himself and becomes committed to what he is doing.
That is of great importance. Community service can be of lasting benefit to those individuals who receive it.
What has happened to the consultative document that the TSA was due to publish, according to the Manpower Services Commission, some while ago? I have not seen it yet.

The Under-Secretary of State for Employment (Mr. Harold Walker): The right hon. Gentleman has referred to the TSA consultative document, but I think he may mean the TSA five-year plan. which has been published.

Mr. Prior: No. I am referring to a plan that the TSA put to the Government and on which so far the Government have not commented. I shall look up the reference for the hon. Gentleman.
I do not believe that Community Industry is a universal panacea for all our problems. On the other hand—[Interruption.] I wish that the hon. Member for Bolsover (Mr. Skinner) would sit quiet and listen, because I do not believe he has done much listening this afternoon. Some of us are trying to have a constructive discussion on these matters and if the hon. Gentleman is not prepared to listen, I do not know why he has bothered to come. Perhaps he will either listen or shut up.

Mr. Dennis Skinner (Bolsover): First, I do not know whether the right hon. Gentleman is aware of it, but very few hon. Members are listening to him; indeed, very few are even present.
Secondly, many of us are unable to follow what the right hon. Gentleman is saying. He has been meandering over a rather wide course. However, there is something that he has failed to tell us, and perhaps he will tell us now. As one of the chief protagonists of the great European or Common Market cause, perhaps he can explain why, although we were promised that entry into Europe or the Common Market would provide wonderful opportunities not for our generation, but for our children and our children's children, after only two years' membership we have among our youngsters the highest unemployment rate for many, many years and the prospects arc even more disastrous? Why does he not tell us what the European Community can do for the young people who are unemployed and who have no prospects of being employed for many years to come? That is what he should concentrate on.

Mr. Prior: I knew that it was a mistake to give way to the hon. Gentleman, but I hope that he will at least now listen to the debate, instead of carrying on a private conversation in which only he and his hon. Friend the Member for


Keighley (Mr. Cryer) appear to be interested. I hope very much that he will now pay attention to the debate.
If the hon. Gentleman thinks that withdrawing from the Community at this stage will do anything to help the unemployment problem, I should like to inform him that unemployment levels of school leavers and many other people will be considerably higher if we come out of the Community than they are at the moment.

Mr. Skinner: Prove it.

Mr. Prior: In this debate we are concerned about trying to help and to discover what methods there are of helping school leavers this year to obtain jobs. If the hon. Gentleman wants to bring in political considerations and raise the temperature—and I have been trying so far to keep the temperature low—he is setting about it in the right way. We have at present a Government under which unemployment for school leavers this summer will be higher than at any time since the war. That is the sort of question that the hon. Gentleman should be asking his own party. Perhaps he will do the courtesy of either asking it in the parliamentary Labour Party meetings or at the right time in this Chamber, instead of talking the whole time from a seated position.
Community Industry is not a universal panacea for all problems, but it has done extremely good work. It has cost about £1·6 million a year, has trained 5,000 young people in the two years or more since it was set up. and is operating in 20 different areas. I hope that we shall hear something this afternoon about the scheme which the Community Industry committee presented to the Government last August and whether the Government will take action upon that scheme.
I believe that we could considerably increase the number of people being trained and helped through Community Industry. The Under-Secretary of State has mentioned a figure of 2.000 people for this year. I am told that this figure could be doubled in a month and could increase to 10,000 very quickly—certainly within three months if that was desired. I commend the work that Community Industry has done. It has performed an extremely useful function. I hope that the Government will announce today that they are

increasing the number of young people who can take it up.
I should like to ask the Government whether they have thought about raising the age at which young people can take advantage of Community Industry. At present, the age is 18, but have they thought about putting up the age? Are they giving consideration to other points that have been put forward such as the organisation of work experience schemes and co-operation with colleges of further education in the mounting of low-skill training courses? Are these points, which are advocated in the report, being considered by the Government and can we hear more about them this afternoon? I hope that something quickly can be done and that we shall not have to wait for months before we get any help in this direction.
On the subject of work creation generally, I confess that I do not find particularly attractive schemes that just create work on a temporary or one-off basis, although the Government may have to consider them in the short term. They are, of course, palliatives rather than getting at the long-term solution "Operation Eyesore" was an example, and the creation of extra jobs during the winter is yet another. But these are short-term solutions. There should be a plan, and I hope that the Government have a plan, for additional jobs for school leavers from September onwards, if that is necessary and if my other suggestions do not add up to enough.
What about the cost of all this? There are always arguments that the money cannot be found and that we have to cut public expenditure. I accept that public expenditure is too high and must be reduced. Therefore, it becomes a matter of priorities and deciding where the greatest long-term benefit lies.
As I mentioned in a debate a week ago, the cost to industry of the Employment Protection Bill is estimated at £100 million a year. The cost of new investment in British Leyland is estimated at about £1 million a day. The proposals for the nationalisation of the shipbuilding and aircraft industries will also cost a great deal of money. Surely we should not spend money on subsidising existing jobs where industry is declining and diminishing when there is an opportunity


of helping and training people and providing new jobs.
If Socialism is the language of priorities, have the Government got their priorities right in the spending of cash? It is a curious language under which vast sums can be spent on food subsidies and propping up British Leyland indefinitely and yet money cannot be found to help school leavers in training or in finding jobs.

Mr. Bob Cryer: rose—

Mr. Prior: I shall not give way to the hon. Gentleman because he and his hon. Friend the Member for Bolsover (Mr. Skinner) have talked throughout my speech.

Mr. Leslie Spriggs: During the 13 years of Tory rule, and then during a later four years, there was no investment in training young people in the higher skills. Can the right hon. Gentleman say why his party failed to invest in that direction?

Mr. Prior: Apart from the fact that we did invest, there is one great and overpowering reason for that, namely, that throughout our 13 years in office there was high unemployment among school leavers and there was investment in industry which enabled them to be employed. Since 1961 the problem of unemployment among school leavers has increased. Until that time, the position was extremely satisfactory.

Mr. Spriggs: rose—

Mr. Prior: Not until I have finished answering the hon. Gentleman's last question do I feel it necessary to answer the next.
In recent years, the Conservative Government vastly expanded the amount of cash spent on training. The Conservative Government started the Community Industry scheme which has enabled a number of young people to obtain a year's work doing community service. All these matters have helped. What I am suggesting is that, at a time when unemployment is rising rapidly and young people are most likely to suffer, more needs to be done. We need to spend money on helping young people rather than on some of the ridiculous. schemes which the hon. Gentleman is supporting.

Mr. Spriggs: I thank the right hon. Gentleman for giving way a second time. A most important consideration with which the right hon. Gentleman has not dealt is the hundreds of thousands of young men and women who go into dead-end jobs which do not call for the exercise of skill. Will the right hon. Gentleman apply his mind to that matter?

Mr. Prior: I have dealt with points such as that. Perhaps the hon. Gentleman was not concentrating on what I was saying or perhaps his hon. Friends were talking so much that he could not hear. I said that in the last year at school much more needs to be done in providing industry induction schemes and the right type of training for young people. This would help enormously in solving our problems.
I hope that we shall not hear from the Government that they cannot extend the schemes this year because of the need to curtail public expenditure. I should have thought that it would be far better to lift some of the burdens which the Government intend to place. and already have placed, on industry—for example, under the Employment Protection Bill—and to seek the co-operation of employers in helping to implement the ideas for school leavers which I have put forward. The general impression one rains from reading the documents, of which there is any number, on the subject of the problems of school leavers is that there is a lack of an overall strategy and programme which spans education, careers, work experience and training. There is almost an embarrassment of ideas, but they lack decision and direction from the Government.
I hope that the Government will take this opportunity to explain their position and will give convincing reasons for what they are doing in the light of a situation which I think, and which many hon. Members on both sides of the House think, will be more serious than any we have experienced since the war. I hope that the House today will discuss these serious problems and will decide on what extra help can be given so that we do not reach July, August and September with an increasing number of unemployed school leavers and no plans to deal with what could then become a very serious social problem.

4.7p.m

The Minister of State, Department of Employment (Mr. Albert Booth): I welcome this opportunity to debate the subject of employment problems and prospects for school leavers, which is of deep concern and interest to my Department. As the problems of school leavers seeking employment are, in certain important ways, almost indivisible from the general problem of maintaining employment in the country, I hope that the right hon. Member for Lowestoft (Mr. Prior), in expressing his concern, will consider the extent to which the Opposition's lack of support for some of the measures which the Government are introducing to sustain employment in industry is compatible with the position he has taken.
The right hon. Gentleman referred to the money spent on maintaining existing jobs. If we did not spend that money, the position of school leavers this summer might be considerably worse. The right hon. Gentleman also referred to the question of propping up British Leyland. This is not merely a propping-up operation. It is also very much concerned with putting the firm on a viable basis to maintain not only the jobs of the extensive work force, numbering 170,000, but the jobs of many other people working in firms supplying it with components and distributing its products.
Therefore, although I echo the right hon. Gentleman's concern about the prospects of school leavers, 1 cannot agree with the contention that what the Government are doing to support existing employment is incompatible with proper concern for the interests of school leavers. There is strong evidence that the prospects for school leavers and young people generally are adversely affected by economic recession to a far greater extent than those of the majority of adults.
There are many reasons for that. As the right hon. Gentleman fairly pointed out, one of them is the decision of firms to cut recruitment in times of recession. But if such firms are not supported by the Government through difficult periods, the probability of their cutting recruitment must be even greater. Young people, particularly unskilled young people, tend to change jobs more frequently and to leave one job before obtaining another. When we are saying that we are talking in the main about the unskilled, about those

without qualifications. The young man or woman who goes into a long-term apprenticeship for a period of training is likely to remain in his or her job. The sample survey undertaken by the National Youth Employment Council showed that 24 per cent. of those unemployed had had more than four jobs since leaving school. In the past and as of now the problem has tended to perpetuate itself for those most severely affected by it.
The policy of "last in, first out" in layoffs has been a problem that has affected more the young person in the unskilled category than those who are skilled. However, in our labour practice and in our labour market we have certain rigidities which particularly concern school leavers. Those organisations which take a high proportion of qualified school leavers naturally adjust their recruitment on the basis of a twice a year supply of school leavers. That is principally true of entry into the professions and entry into craft training. Therefore, the young person who changes his job a few times in the space of two years after leaving school and seeks a job at some other time of the year than the normal school leaving period is in a far worse position than the well-qualified leaver who leaves school at the end of the summer term.
In recent years it has become apparent to those closest to the problem that there is a great gulf between the aspiration of many school leavers and the number of training opportunities which exist for them. That is particularly true of those with few or no academic qualifications. In my experience it does not follow that because a girl or boy has not done particularly well at O-levels he or she will not have aspirations to be an engineer, for example. or to do some other kind of qualified job. What is certain is that their chances of obtaining that training will be very much less than those of their school-mates who qualified well. That points to one of the most worrying aspects of youth employment—namely, the extent of those who leave with no educational qualifications.
The right lion. Gentleman referred to the working party survey of November 1972 which showed that only 11 per cent. of young unemployed people had CSE grade 3s or better. To put the situation in another way, 89 per cent. had lower educational qualifications than CSE grade 3s


or had none at all. The improvement in the general standard of those leaving school since November 1972 will help, to some extent, with the solution of the problem.
I shall examine briefly the present prospects. I do not think it helps to paint a blacker picture than is justified by the present situation. Over half a million people will leave school in Britain within a few months. We are understandably concerned about their prospects, but we must keep the problem in perspective. It will not help the problem if we make unrealistic, gloomy forecasts. There is a real likelihood that many of those who are unqualified will find it more difficult to find suitable jobs than in previous years. That is undeniable. However, we can examine the effectiveness of the services that help school leavers obtain jobs in terms of what happened to the school leavers of the summer of 1974. Most of those school leavers found jobs. Of the 526,000 who left at the end of the 1974 summer term only 8,000 were unemployed at the end of the year—namely, 1.5 per cent. As an employment Minister I wish that the percentage of adults unemployed was as low.
Until Easter of this year unemployment amongst school leavers was still falling. I am glad to say that it was falling particularly in some of the assisted areas The total number of young people unemployed in March, including school leavers, was 32,000. That compares very favourably with the peak of 105,000 that was reached in 1972. It is too early yet to know how this year's Easter school leavers will be absorbed into employment. Employers on being approached by careers officers, are generally cautious in saying how they will respond, and much more cautious than in more prosperous years.
We are dealing with a problem that is not peculiar to this country. In the United States, Italy, France, the Netherlands and Germany there is a considerable problem of unemployment among young people. In Germany in December last year there were 100,000 young people unemployed. There were about 240,000 young people unemployed in France. The Government are anxious that we should examine the special measures that we apply for young people.

Mr. Gordon Wilson: Does the Minister agree that the position of young people in Scotland is very grave when contrasted with the scarcity of skilled manpower, especially in the metalworking industries. Does he accept that there may well be some room for special Government assistance for training with private firms, perhaps apart from apprenticeships, within the metal-working industry so that the scarcity of skilled manpower may be reduced since it is holding back industry in general in Scotland?

Mr. Booth: First, I agree that there is a problem in Scotland, but, measured in terms of the drop in vacancies for young people, the position is not dissimilar from that in many other regions. One of the special factors in Scotland is that there is a serious shortage of skilled manpower. I agree that in the engineering industry, and in one or two other industires which in the main employ skilled people, there is a strong case for examining the effectiveness of the mechanisms which now exist to revive special training.
General economic conditions and industrial practices will have had an effect on young people's job prospects. Only through an attack on those general conditions and by regional and industrial schemes can we hope to deal with the maldistribution of job opportunities. Measures to save British Leyland are an outstanding example of Government actions which have wide implications for young people's jobs. In spite of that, the vulnerability of young people requires special action to be taken in the short and long terms.
The Manpower Services Commission has, from its first meeting last year, been involved in improving opportunities for young people, and especially in terms of training. I think that the report which the right lion. Gentleman referred to is a special report dealing with training for young people which is in the course of preparation by the Training Services Agency. It is in the nature of a consultative document. Training does not make jobs but it qualifies people to take jobs which exist. With vacancies for young people equivalent to twice the number of school leavers unemployed, that is a factor of the utmost importance. Technological change creates requirements for new skills, and the young person, who generally possesses the ability to learn


more rapidly than others, can be at an advantage when given access to good training facilities. It is better to spend time training than to spend time unemployed. This is even truer of young people than of adults. Psychologically, nothing can be worse for young people than to leave a period of full-time education for a period of enforced idleness. It is better for them to feel that they are employed in another form of education or vocational training which will enhance their chances of obtaining worthwhile employment.

Mr. Leslie Spriggs: In view of what my hon. Friend has said about the advantage of being able to take up training in an apprenticeship course, what incentive does the Department of Employment offer to young people to stay in jobs involving apprenticeships for a number of years at low rates of pay rather than to take labouring jobs at much higher rates of pay?

Mr. Booth: We are at present reviewing the whole area of training allowances. My personal opinion is that this is not necessarily an area to which we can give high priority compared with other forms of training expenditure. I see it mainly as the role of trade unions to negotiate a proper rate of pay for apprentices. We have moved on from the day when apprentices were underpaid, or even had to pay for their training. Although it is proper to review these allowances, I do not hold out hope that we shall give that matter great priority over certain other demands. The form of training to which I was referring must go much wider than apprenticeship and must give some young people who are now unemployed access to training in advance of job openings, be they apprenticeships or other forms of skilled work.
The initiatives taken by the Manpower Services Commission and the Training Services Agency are of special importance. The Training Opportunities Scheme has given a second chance to a great many young people who have taken a few years to find a particular area of work which is of interest to them. There has been a tendency in society to condemn young people who do not immediately settle down to a form of work which suits them. I remember well

in my own apprenticeship days meeting fellow apprentices who, after about two years in that form of work, realised that they were very much square pegs in round holes, but knew it was impossible to give up that apprenticeship and find something more suitable. It is remarkable that many young men decide to take four-year apprenticeships in certain trades without having seen the inside of the places in which they have chosen to work for the rest of their lives. Therefore, it is of the utmost value that they should have the opportunity to reconsider their situation and to retrain.
The short industrial courses and wider opportunity courses are still in early stages of development, but they are proving to be most helpful to young people. They have the advantage of not being restricted to people who have left full-time education for three years. This restriction does not, of course, apply anyway to some specially handicapped groups, to which my hon. Friend the Under-Secretary of State for Employment will refer in greater detail in his reply.
This aspect of the subject is not only a responsibility for the Government, MSC, TSA and career officers. Their initiative needs to be supplemented by other efforts in terms of organisation facilities and courses to be made available in all the areas where they can be of most benefit to the young. I hope that local authority representatives, trade unionists and employers will be in close touch with the MSC and the TSA with a view to setting up more short industrial courses. The Government are providing an additional £50 million over the next two years for training developments. 1 hope that the scheme already mounted for apprentices made redundant to continue their training will be extended. The TSA plans to extend direct training facilities so that 4,000 young people will be able to undertake training courses in 1976 through the auspices of the scheme. The Community Industry scheme to help the seriously disadvantaged to bridge the gap between school and normal employment is to be continued.
I agree with the right hon. Member for Lowestoft that the scheme will not be an overall panacea but will assist in particular areas. Its success rate is a great compliment to those who have been


responsible for running the scheme. The Government's main aim must be in the area of policies to safeguard employment generally. The recession which is now taking place, the drop in world commodity prices, the rise in oil prices and the international trade uncertainties make this a priority. To attempt to solve any of these problems by mass unemployment would be an economic and moral crime.

Mr. Gordon Wilson: I was interested to hear the Minister refer to the drop in commodity prices. I should have thought such a drop might be an incentive to employment rather than a disincentive —in other words, that a rise in commodity prices would make it difficult to compete elsewhere. Would the Minister care to comment?

Mr. Booth: We are a trading nation. If there were to he a drop in the prices of some goods which we are seeking to sell abroad to enable us to live, this would create particular problems for us.

Mr. Gordon Wilson: Does not the Minister agree that if the price of imported raw materials drops, it will help the situation of the manufacturing countries?

Mr. Booth: Representations made to the Government by those most directly involved in these matters suggest the reverse. For example, the textile workers believe that a drop in the price of imported textiles will lead to lay-offs and short-time working in the home industry.

Mr. Gordon Wilson: The Minister is referring to manufactured commodities. The point I was seeking to make was that the rise in oil prices is a disincentive to the manufacturing countries but that the importation of cheaper raw materials should help the manufacturing countries.

Mr. Booth: I accept the hon. Gentleman's point. I was referring to manufactured goods, but it is also true that there is no automatic benefit from any fall in the price of raw materials.

Mr. Skinner: When commodity prices fall, and since those goods derive in the main from the less-developed or underdeveloped countries, does it not mean that those nations receive less in real terms for the goods which they are selling to the developed countries? Does it not also mean that they are unable to pay as much for manufactured goods and con-

sumer durables as they otherwise might pay? Is not the question of a fall in the price of oil a quite different matter because that money is recycled in a different fashion?

Mr. Booth: 1 do not want to enter into a long-term analysis of commodity prices, but I agree in general with my hon. Friend. We cannot necessarily rejoice in a fall in the price of commodities exported to us by under-developed and developing countries since it might affect their ability to trade. The Government's prime objective is to make the fullest use of our economic resources.
We are using the Industry Act 1972 to assist firms in financial difficulties, particularly in areas of high unemployment. We are also in the process of creating the National Enterprise Board, which will lift the level of investment in certain areas and thereby create jobs. We are strengthening and accelerating the growth of the training programme. We are bringing in special measures to train the unemployed. The Government have given special assistance to the regions by doubling the regional employment premium, by the use of IDC controls, by advance factory programmes—and, in the case of Scotland and Wales, by the creation of the Scottish and Welsh Development Agencies.

Mr. Gordon Wilson: They are not here yet.

Mr. Booth: They are not here yet, but we are preparing for them.
The temporary employment subsidy which is now being worked out, is intended to give the Government the power to make special payments for limited periods to prevent or defer redundancy. We hope to announce that to the House shortly.
There is one aspect of this problem of school leavers' unemployment which I feel has not received anything like the attention it deserves. I refer to the sudden change from full-time education to full-time work. This is especially a problem for those who enter unskilled employment. In the case of the young person taking up an apprenticeship or any form of detailed training there is a natural process of going from one form of learning to another. But that does not occur in the case of young boys or


girls who have been learning in school until Friday afternoon and on Monday enter a deadly dull, monotonous jobs, which makes very little demand on their ability, intellect and capacity to learn.
I believe that there must be a more gradual transition from full-time education to full-time work, that we need many more day release courses and sandwich courses, and that they need to be extended into the areas of unskilled work. We need to give to the unskilled youngster, who realises quickly after leaving full-time school the importance of taking academic qualifications, an opportunity to do so while earning a living, thus availing himself or herself of the opportunity to obtain a job which is far more satisfying.
That process will in any case be necessary with the increasing rate of technological change, since more people will in the course of their normal working life have to be retrained for another job. Therefore, I am interested in the proposition that schools should become more vocationally oriented earlier in a pupil's school life.
There is a case that full-time schooling for younger people should give a broad-based education and should enable them to train and learn, after leaving school, to cope with the many changes that they wil face—and certainly greater changes than their fathers and mothers faced—during their normal working lives. If that attitude is to gain greater currency we must think in better terms about the requirement of mobility of labour.
As a man who has had to shift his wife and youngsters from one part of the country to another because of my job, and as the son of a man who worked from one end of the country to the other during the course of the slump of the 1920s and 1930s, it may be that I am unduly sensitive to people who talk about mobility of labour and job mobility, thinking that it is an easy matter for people to move around, especially married people with families. However, there is a strong case for saying that one form of job mobility is the ability of people, when one industry or trade in their area closes down, to train to do another job in their own area, and to maintain the social capital and all the assets of the community in which many of them have worked for

a long time. That has implications for education especially. In a job-oriented society such as ours there is still a tendency for people to think of themselves first in terms of the way in which they earn their bread and butter rather than to think of themselves first as mothers, fathers, Catholics, Protestants, Fulham supporters, or jazz fans. They think of themselves as fitters, as turners, or as Members of Parliament, and so on. Therefore our society tends to put a premium on success in employment. The young people who see no prospect of success in the first few years of employment after leaving full-time education begin to regard themselves as failures when in many cases they have great potential, given the right opportunities.
For all those reasons I believe that those involved in education, careers advice, vocational training and the placement of young people in jobs must do their utmost to ensure that the special needs of the immediate future are met and that we work to secure that, in the longer term, a wider range of opportunities for the young and not-so-young is created in the best interests of the manning of industries and services, and by so doing give a greater opportunity for satisfaction and fuller development of potential to the many workers who would otherwise have that potential stifled.

4.35 p.m.

Sir John Eden: I am glad that the Opposition have chosen this subject for debate. I am especially grateful to my right hon. Friend the Member for Lowestoft (Mr. Prior) for the constructive way in which he introduced the debate.
There are clearly no easy answers to the problems which were discussed in the two Front Bench speeches. There is no doubt that this is a problem of growing magnitude. The omens are none too happy. As we look ahead to the later summer months, the prospects for school leavers are looking fairly grim. That does not apply only to those areas traditionally of high unemployment. It seems to apply to all parts of the country. Certainly that is the experience in my constituency.
Recently I attended a meeting of the Northern Area Liaison Committee in


Bournemouth. That committee represents youth leaders, social workers, education, youth employment, welfare, amenities and the police authority. It has been meeting every two months to review trends for leisure time provision and employment for young people. There is growing concern at the prospect of increased unemployment amongst youth in my constituency, especially in the West Howe area.
As my right hon. Friend the Member for Lowestoft said, it is probably those who are of lowest educational ability who will most immediately and severely be affected by the general downturn in work opportunities.
Having listened to the deliberations of the members who make up the committee, I was immensely impressed by their eminently practical and realistic approach to the problem they foresee developing. The committee has been looking at a number of ways to help in the situation envisaged. It has considered, for example, what use could be made of the facilities available at schools and youth centres.
The Government will understand that to a considerable extent those facilities are already stretched and well used, but there may be a need to look afresh at the opportunities that the existence of these facilities provide, especially in the schools after school hours. I know that teachers carry a considerable burden already, but from what I have heard there seems to be a welcome readiness on their part to extend beyond normal school hours such assistance as they may be able to provide in the circumstances which we contemplate.
The Minister made a welcome reference to the need to encourage training and to the fact that that training should go wider than apprenticeship. I agree with that. I ask the Under-Secretary to say what is now being done to follow up the recommendation of the National Youth Employment Council that the Training Service Agency should extend the scope of the Government training available to all young people and that it should consider setting up a junior training opportunity school devised especially for young people. This seems to be a constructive suggestion which should have maximum encouragement.
I was glad to hear the Minister support the positive work being done under the auspices of the Community Industry scheme. This is still in the comparatively early years of its development, though no doubt there are lessons to be learned from its immediate past experience. But, equally, this is a scheme which offers real hope for those able to benefit from it because it will undoubtedly open out the way to a positive rôle in employment when the opportunities become available.
I hope that the Under-Secretary will be able to say a word or two about work creation schemes. We can all envisage desirable schemes which for one reason or another—mainly because effort is diverted elsewhere or because finance is not immediately available—are not being carried out at the moment. But work creation schemes organised on a community basis might well provide an opportunity for constructive work at a time when, without it, there might be merely a vista of unemployment and hopelessness. There are a number of community tasks which could be taken in hand, and I should like to know a little more about the Government's thinking, especially that of the Manpower Services Commission, in connection with schemes of this kind.
I believe that there are two ways in which the Government could give direct help in the situation described by my right hon. Friend the Member for Lowestoft. The first is that they should review their policy towards housing, especially private housing. The energies of the private house building industry need to be released. There is still a considerable demand for housing, especially for what 1 might call the more factory-built type, for younger families. I hope that the Government will not rest content with concentrating on local authority housing and that they will do what they can to encourage the private house building industry, as this will at the same time provide a welcome opportunity for employment for many young people.
Ideally, the Government should scrap their Community Land Bill, which will only damage the whole of our housing and construction industry.
Secondly I ask the Government what consideration they have been giving to recruitment to the Services. I know that


we are to have a two-day defence debate later this week, and for that reason, I shall not elaborate on these matters today. But it has been the experience in the past that at times when prospects for profitable and reasonable employment are dim, recruitment to the Services tends to increase. This is the very time that the Government have chosen to cut heavily into the spending on our defence forces. I hope that Ministers will give further thought to this aspect of a constructive and nationally helpful way in which employment could be provided for our young people.
Directly or indirectly, the Government have been responsible over recent months for stoking up rather than damping down the forces of inflation. In my judgment they have now a direct responsibility for coping with the consequences of their own recent policies. They have an urgent responsibility to help the victims of inflation. One constructive and urgent job which needs doing is to co-ordinate the efforts of all the various Departments and service commissions or other bodies concerned with employment for young people.
There is a great need for further guidance to be given to communities, especially to local authorities. I hope that Ministers will look at the existing guidance which has been made available to local authorities fairly recently on some aspects of the employment of youth. In my view it needs bringing up to date, and account must be taken of the obvious urgency of the current situation.
I hope, too, that the Government will give what encouragement and guidance they can to local authorities to show how various aspects of community and other employment and help can be brought together to bear upon this problem. They should also reflect this in their own actions at central Government level.
Following this debate, I should like to see a top-level Cabinet committee discussion take place at which the Department of the Environment, the Department of Education and Science, the Department of Industry and of course the Manpower Services Commission and the Department of Employment are represented in order to get to grips with this problem and to alleviate the worst aspects of it.
The situation outlined by my right hon. Friend the Member for Lowestoft, which undoubtedly is very serious and which properly gives us all cause for concern, is one which should also be brought to the notice of those currently in employment and their employers. To employers in any community, I hope that an approach will be made asking for their tolerance and understanding, especially in respect of taking on young people for help with training even at this difficult time. To those in employment generally, especially to those who are members of the unions which recently have been demanding wholly inflationary wage increases, I hope that the Minister will make a plea that they should moderate their claims, that that they should show some restraint and that they should have some regard to the youth of our country for whose future they, too, have a responsibility.

4.48 p.m.

Mr. T. W. Urwin: I represent a constituency in the Northern Region of England, an area of the country which, unfortunately, is all too familiar with the problems we are discussing today.
I remind the right hon. Member for Lowestoft (Mr. Prior) that this problem of the lack of opportunities for school leavers is not a new or even a strange phenomenon. I can go back to my own youth in what has always been recognised as a depressed area—now more popularly described as a "development area"— when, like many of my contemporaries and many thousands of others who have followed me down through the years even to this day, I soon became aware that our biggest export was young people, who were our most vitally important and useful commodity. But it was not just a matter of young people leaving the area. In addition, there were those in their early twenties and thirties and even middle-aged people who had no possible chance of obtaining employment of any kind, much less the sort of vocations that they would have chosen if that kind of work had been available.
I should like to recall several years' experience as the chairman of a youth employment sub-committee, which ended when I became Member of Parliament for Houghton-le-Spring in 1964. How desperately and anxiously we seached, cajoled and invited employers to expand their


efforts to provide apprenticeships and employment opportunities of any kind, not only for boys and girls in their late teens but for those who had just left school. Not unnaturally in a situation such as this, all too many of our young people were channelled into dead-end jobs where there was no possibility of being anything other than a square peg in a round hole for as far as they could see.
In a debate of this kind we cannot help but refer not only to personal experiences but to the nature of our constituency and the role it plays in such an important subject as this. My constituency is surrounded, north, south, east and west, by four towns comprising two new towns, Washington and Peterlee, to the north and south, the city of Durham to the south-west and the shipbuilding town of Sunderland to the north-east. I should have thought that in a constituency such as this, so almost admirably geographically located, there would scarcely by any employment problems at all. Unfortunately, traditionally we have one of the highest unemployment rates in the whole of the Northern Region. The Northern Region, as every hon. Member knows, has the unenviable record of having the highest unemployment rate throughout the United Kingdom, with the exception of Northern Ireland. Small wonder that in this kind of situation employment opportunities for young people are at a premium.
I want to enter a special plea. If there is one thing that the Northern Region needs above everything else, it is an infusion of clerical and Civil Service jobs. Hon. Members who represent constituencies in the Northern Region have spared no effort to convince their colleagues, Ministers and hon. Gentlemen who were in the Conservative Government between 1970 and 1974 of the vital importance of bringing more work of this kind to the regions. We held out high hopes. Indeed, when we were in Government we had decided that a Pay As You Earn computer centre would be sited at the new town of Washington. That decision was upturned when the right hon. Gentleman and his right hon. Friends came into Government in 1970. There has been some small compensation, but nothing as big, measured in numerical terms, as the number of jobs that would have been provided in the PAYE centre.
The National Shipbuilding Headquarters surely should be a red-hot favourite to be sited on the North-East Coast. I say that with obvious regard to the claims of the other shipbuilding areas in the United Kingdom. However, the Northern Region is second to none so far as shipbuilding is concerned. With the record that we have on the North-East Coast, clearly and surely there can be no other home for the National Shipbuilding Headquarters. This, in turn, would at least provide a few jobs for those youngsters leaving school with minimal academic qualifications, who would be able to take up their first post in this sort of Civil Service administration.
I implore my hon. Friends, as my colleagues in the Northern Region and I have implored Ministers in the more responsible Departments over some weeks and months now, and I exhort them, to ensure that at least this small plum should come to the North-East Coast. My hon. Friend the Member for Easington (Mr. Dormand) is trying desperately hard to encourage more Civil Service jobs into the new town of Peterlee, as indeed is my hon. Friend the Member for Chester-le-Street (Mr. Radice) so far as Washington new town is concerned. If we are successful in these efforts, clearly there will be a spin-off for young people living in neighbouring constituencies. After all, this is a fairly densely populated area of the Northern Region.
However, there are other important requirements. For many years, against great odds, we have tried to present a case for a section of the motor car industry to be sited in the Northern Region. I know, like the rest of my right hon. and hon. Friends, just how many attendant problems there are in the car industry. However, we are willing to accept all the risks and problems which confront the car industry at present if, in turn, x numbers of youngsters would be able to take up apprenticeships in this vitally important section of British industry.
In my constituency, where there are seven coal mines, two of them mining well out under the North Sea, the major employer is still the National Coal Board. It is doing a good job training young people, but there are many youngsters leaving school who simply do not want—as I never wanted—to be a coal miner. Provided that there are sufficient jobs of


a different kind available, those young people should not be compelled to be coal miners.
The right hon. Member for Lowestoft spoke about the possibility of better utilisation of public money rather than pouring money into British Leyland. My hon. Friend the Minister of State dealt adequately with that point. The right hon. Gentleman will recall that many of the problems with which we are confronted are, first, the responsibility of his Government as late as December 1973 because of the colossal cuts made in public expenditure and, secondly, because of the Government's unfortunate decision a few weeks ago. The combination of these decisions means that the construction industry is in recession.
I want to reinforce the argument of the right hon. Member for Bournemouth, West (Sir J. Eden), who spoke about the construction industry. The construction industry is too heavily depressed at present. We have read—if we have to read to ascertain the facts of life—in the Press today, over the weekend and for some days past of the gloomy prognostications of people who are closely concerned with construction, none less than the national president of the National Federation of Building Trades Employers. I have a great deal of sympathy with the case that that federation presents. As a Member of Parliament I have participated at meetings with the federation recently as well as at meetings with representatives of the building trade unions.
Increasingly deep concern is being expressed about the present depressed state of the construction industry. Because of the cuts in public expenditure, Government and local authority contracts are being withheld and not being put out to tender. There is a decline in the number of orders. There is also a problem in the house building sector of the construction industry. I suggest that my right hon. and hon. Friends should combine to impress upon the building societies the real importance of considering at least a reduction of the mortgage interest rate. This would surely provide some impetus to the private sector of housing to get ahead and provide more housing.
There is also the necessity to cooperate with the local authorities in order

to speed up the provision of council housing. My hon. Friend the Minister referred to advance factories. I applaud the decisions that have been taken by my Government since last February in regard to the allocation of advance factories, some of them in my constituency. However, as far as I am aware, there has not yet been a brick laid or a foundation dug. I should like to know when it is expected that work on these projects will begin, not only to provide jobs possibly for youngsters leaving school but also to provide the much required jobs for building trade workers. When will these things begin to materialise? The building industry urgently needs this stimulus not only to protect the employment of craftsmen already in the industry but because of the impact on recruitment of apprentices. I understand that in the Northern Region the potential annual intake is 3,000 apprentices, but on present forecasts that intake will be considerably reduced.
The right hon. Member for Bourne-mouth, West referred to recruitment to the Armed Forces and the circumstances of the increase in recruitment. I can tell him that the recruitment to the Royal Navy and the Royal Marines is higher in the Northern Region, according to the last report to the House, than it has been for many years, although we are by no means in as badly depressed a state as we were in the 1930s and again in the early 1960s.
Proud as I am to have been a member of the Royal Marines during the last war, I would much prefer to see my young constituents channelled into useful, meaningful employment which they enjoy rather than having to rely on seven, 12 or 15 years, or whatever it is, as a soldier or sailor, or even as a marine.

5.3 p.m.

Mr. Anthony Steen: A young person at school could be compared to a boat in a lock. He is waiting for the time when the gates will open and he will be ready to go out along the river. What a shock he gets, therefore, when, after all the years of build-up and expectations, the lock gates open and there he sees in front of him a dry, parched river bed and no hint of water.
School students' thoughts are inevitably oriented towards the future, and students expect, quite rightly, that satisfying employment prospects will become available, and not only if they take a further period of full-time education and training. Although some young people land apprenticeships, for the majority of what would have been early school leavers there are few prospects and fewer satisfying jobs.
May I ask the Minister to have particular regard to the problems that early school leavers have—what were the early school leavers—in finding the right place to register for jobs and the right place to go to draw their unemployment benefit? There is in my experience on Merseyside a limited amount of available information which the school leaver can find easily. I would suggest that in all schools there should be far greater assistance from the school teaching staff to help a young person when he leaves school to find out how he can claim benefits and register for employment.
However, a job should be something far more than mere toil which a young person uses, in return for which he gets cash. It is something which he should have as of right. It is something which I believe should be contained in a young persons' charter, whether that person be black, white, boy or girl, which gives him or her the right to an opportunity, equal with all others, of a satisfying job.
If a young person be deprived of the opportunity to make a contribution to society, too often he turns on to society rather than into society. In human terms a young school leaver who can find no meaningful work feels rejected and disillusioned and may use his energies to disrupt society, which he feels has deserted him at the crucial hour when he most needs its help.
The previous Conservative Government made a useful but modest contribution to tackling the problem of the unemployed and the unemployable. In concept, it was to provide social and community work jobs for disadvantaged young people which would first be evaluated by young adults, who would, in turn, supervise the work carried out. In concept, Community Industry was to be a kind of halfway house, an introduction to employment, but only of a temporary

nature. The community service jobs which Community Industry tackles are seen as jobs. That means that the young people turn up and clock in at 8 a.m. and they leave at 5 p.m. It is not seen as a community service. It is seen as a job.
This is an important concept, and we have such a scheme in Liverpool. It does good work. Some of the most encouraging and worthwhile projects involve developing sustained personal relationships. I stress that matter. It is not merely clearing canals and painting walls. It is the development of personal relationships. Many of these young people have not had the opportunity of close personal relationships. The importance of this work is that it opens up a new vista to such young people and helps them to understand the problems they themselves have in dealing with other people. For example, there is one scheme on Merseyside which helps brain-damaged children who have been kept out of institutional care, thus saving the taxpayer some £2,000 or £2,500 a year, by practising the Doman Delacato method, which helps parents by organising various exercises for 10 to 12 hours a day with brain-damaged children to assist the blood circulation and make them able to cope with some of the smaller chores of life. The parents cannot cope with this kind of intensive treatment, which takes 10 to 12 hours a day, without the help, for example, of Community Industry volunteers. This is of tremendous benefit to society, to the family with the brain-damaged child and to the volunteers—if one can call them that—and it is saving the taxpayer considerable sums of money.
Community Industry provides meaningful social work opportunities for less-well-equipped young people, but it is on a modest scale and there are difficulties of weaning young people away into full-time employment where they do not receive such close support, help and comradeship. It may also undermine volunteers. I should like to stress this point because in Newport in Monmouthshire—which you, Mr. Deputy Speaker, will know so well—the Community Industry scheme was housed next door to the Young Volunteer Force project. In one house a person went in and did unpaid work of a very similar nature to Community Industry's work. If he went through the


next door he clocked in and did very similar work on a paid basis. Therefore, the concept of voluntary work or volunteer work could be undermined by paying people for doing the same job. Although those who tend to do Community Industry work are different kinds of people from those who volunteer, nevertheless there is a question in the mind of a volunteer as to why the other person is getting paid and he is not.
Job creation, which is what Community Industry is about, is a new concept in Britain. It is the first along the path. What we must do is something far more creative, imaginative and widespread. We can learn much from the Opportunity for Youth Programme and the Local Initiative Programme in Canada, both of which I was involved in at their inception. I know that the Minister has sent some of his officials to look at these schemes and to bring back knowledge to this country.
I should like to comment on the Opportunity for Youth Programme because it is a creative and outstanding success. It was planned initially as a 36-million dollar summer employment programme aimed at carving out jobs for students. I should digress and say that in Canada students do not get the kind of grants given to students in this country. Their grants are far more modest. They are insufficient for the students to live on and insufficient for them to pay their fees. Therefore, they must supplement their grants by employment.
Initially, the jobs given were in the Civil Service—when the civil servants went on leave the students moved in—and in the Armed Forces. Two or three years ago employment problems became so severe in Canada that the Canadian Government had to think up new ways of creating jobs. Unlike Community Industry, instead of the Government or civil servants dreaming up jobs, even if they are imaginative civil servants down at the grass roots, the Canadian Government put the programme in a completely different way. They turned the tables. They told the students—tens of thousands of them—that they had to make their own jobs.
The Federal Government sent regional supervisors throughout Canada—the

supervisors were young people—encouraging students to carve out and plan jobs for themselves and then write a contract or make an offer. The students had to draw up a couple of pages in the shape of an offer and the Government could then approve it or not as an acceptance act. The roving supervisors could approve the schemes or not or make amendments. Once a contract was approved, the Federal Government paid monthly, just like a salary cheque, through a banker's order for the work done by the young person.
The key feature was that the supervisors were young. the students involved in the projects were young, and the civil servants in Ottawa were young. The whole thing was a young demonstration of constructive thinking and action.
In that way housing aid centres were developed in Winnipeg. A great deal of conservation work was done, but I should not over stress the manual side. It was creative thinking and action work in terms of teaching immigrants English and helping some of them to fill in Government forms which were so complicated that they could not readily understand them.
I understand that 15,000 jobs were created in the earliest days. The number goes up and down according to the unemployment figures. The young themselves and society benefit. Such a scheme allows the community to take a different view of young people, and it allows young people to exercise their enthusiasm and confidence to learn by their mistakes. Mistakes are made and problems arise. For example, a recycling project in Vancouver—picking up waste paper—was given a great deal of Federal money through grants which competed with private enterprise. Enormous problems can be created when Government funds are given to projects which are in direct competition with private enterprise. No doubt the Minister will have regard to that matter when considering the employment service agencies being set up in our High Streets. There is one going up in my constituency virtually opposite a private employment office. That may create a problem which will need to be considered well in advance.
Those who are often the greatest critics of young people in this country were the


greatest critics in Canada. The Opportunity for Youth project kept running into difficulties when the City Fathers criticised it for being too involved and taking too great an interest in community matters. I suggest that that is a price that we must pay. We have not yet adjusted well enough to that in this country. Wherever young people arc involved in community projects, they are regularly criticised by the City Fathers for showing too much interest and critising what is already going on. We want far more community involvement and jobs created wherever young people can show their interest and concern.
For that reason, I suggest that the Minister needs to do something more dramatic than he has considered doing so far. We must open up a completely new job potential. That can be done only if the Minister puts the onus not on civil servants but on those who are unemployed.
It is true that the Canadian scheme was primarily for university students. They could take the initiative and they had the training to develop their own jobs. But I believe that young people who have not been to university, if given the opportunity and support, can develop a similar kind of concept to what has been done in Canada with great success.
My final point concerns who runs the projects. Youth services in Britain have the distinction of being run by the middle-aged. If jobs are to be carved out, please let the young choose those jobs. Let the bureaucracy and controls be kept to the minimum. Let us say that we would like to see job creation in limited areas as pilot schemes, but that they must not be part of the bureaucracy. They must be independent, although under some Government control.
I suggest that there should be an entirely new appeal to the young unemployed and a new drive. The financial cost will be modest, because unemployment benefit has to be offset. We must also put into the melting pot the social cost factor. We must not forget the enormous damage done to young persons—their personalities, hopes and confidence for the future—if they are cast aside as unimportant individuals. Each young person matters. The Government must show that they care deeply by

creating jobs which are highly sensitive to the needs, aspirations and abilities of each unemployed young person.

5.17 p.m.

Mr. Dennis Skinner: Thank you for calling me, Mr. Deputy Speaker. I always seem to be called when you are in the Chair. The rather remarkable thing about the debate—

Mr. Deputy Speaker (Mr. George Thomas): Order. I hope that the hon. Gentleman is not implying anything about anybody else who might be in the Chair, because that would be highly out of order.

Mr. Skinner: In fact, there are occasions when I run into difficulties. I was just commenting on the fact that I did not seem to be having one now. It was merely an aside. I did not want to affront anybody, and certainly not you, Mr. Deputy Speaker. That is the last thing that I would want to do.
It is remarkable that on a day when we are discussing employment, particularly youth employment, this Chamber should be so empty. It is a well-known fact that not every Member of the House of Commons can be in this Chamber at any given moment. There are many other jobs to do. There are no doubt Committees sitting and things of that nature. But the fact is that, even by House of Commons standards, the benches are remarkably vacant. I suggest that that is not because the matter under discussion is not important. I think that without doubt this subject is probably more important now than for the past couple of decades.
We are now beginning to witness what the breakdown of the system under which we operate really looks like. It has been in a crisis situation for 25 years or more. I tend to look at the question of young people's jobs in a different context from the hon. Member for Liverpool, Waver-tree (Mr. Steen), who, well-intentioned though he is, suggested scratching up a few jobs just as they have seemingly managed to do in Canada. The real question that we have to answer in this place or in any other forum is not merely how sufficient jobs can be created for the young, but how sufficient jobs can be created to go round out of which young people leaving school or those who have


recently left school will be able to take their share.
We can invent 1,001 Alice-in-Wonderland training schemes, and I have no doubt that at the margins the new venture will provide a few jobs for young people, but we are faced with a chronic situation—so chronic that private manufacturing industry can no longer cope. There was a time when it was relatively easy for the large manufacturer to eat the small fish when they ran into trouble and catch the remaining part of the market, but now there are only big fish, and in recent years, culminating in the situation in the car industry in particular and in British Leyland specifically, we have seen the real giants being unable to cope with investment problems or to overcome cash flow difficulties.
That being the position, instead of asking for regional grants and all kinds of cosseting and pampering which is paid for by the taxpayer to the State and them on to the private company, we are seeing these giants being unable to provide the jobs that are necessary, and that is what this debate is about. It is true that this is only a small part of a much bigger problem, but we have to solve the bigger problem if we are to get over the difficulty of creating sufficient jobs for young people.
Some may take the view that as a result of the Budget and statements made by my right hon. Friend the Chancellor of. the Exchequer things will look up, that there is some sort of boom in the offing in the world scenario, starting in 1976. I do not believe it. I think that we have just been through one of the old-fashioned Keynesian booms. We have seen the minimum lending rate come down on about seven occasions in the last few months. Most of the economic experts would have us believe that this is part and parcel of increasing investment opportunities, and that by reducing interest rates generally we provide more jobs.
We have been through that one. We have arrived at the point of no return, and on Friday for the first time in many months we saw a change in the scene. The minimum lending rate is going up, and this will be followed by further increases. Although many people will not believe it, because we already have nearly 1 million unemployed, it is my

opinion that we are coming out of a boom and going into a recession. Using the old-fashioned devices to measure our economic performance, that is the stage we have reached.
The prospects of jobs for young people are catastrophic, and they will be in an even worse position than they are now. My hon. Friend means business when he talks about what he is trying to do in his Department to deal with the problem, but unless there is a change in the macroeconomic outlook, as it is called, his attempts will not resolve the real problems with which we are faced.
I see not 1 million but 1½ million unemployed within a relatively short time. Some of the Budget announcements and measures will bring that about. The 25 per cent. VAT rate on a wide range of consumer durables will mean that young British workers in electrical and other factories will be thrown out of work.
The middle-aged will want to protect their employment. They will not want to give up their jobs to young people because those are the only jobs they have and they do not want to join the ever-growing dole queue further down the road.

Mr. Kenneth Lewis: The hon. Gentleman has hit upon an interesting point.

Mr. Skinner: I always do.

Mr. Kenneth Lewis: If the Government continue to make redundancy payments—as they are committed to do under legislation passed by Governments of both parties—this will increase the difficulty for young people trying to get jobs because firms faced with cash flow and profitability problems will not want to make redundancy payments. The middle-aged about whom the hon. Gentleman is talking will keep their jobs. Firms will not let them go. but will put them on part-time work. What is more, firms will not recruit young people at the lower levels, and this is the problem which the Government must consider.

Mr. Deputy Speaker: Order. That sounded not like an intervention in a speech but a rather long contribution.

Mr. Skinner: The hon. Member for Rutland and Stamford (Mr. Lewis) was


a bit long-winded, but I shall answer the point. I have no real evidence for saying it, but I rather suspect that the next move on the board might come from the TUC's recommendation to the Government—and this was mentioned by my right hon. Friend the Chancellor of the Exchequer —that money should be provided to prop up private industry. I do not expect that my Government will fail or refuse to prop up the system that we have or to prop up the private sector of British industry. They do not have a total mandate to change that, although I do, but I am not on the Government Front Bench. '[lie Government will continue to cosset and pamper private industry, and it is my guess that to ameliorate the rather stark position that has been outlined during the debate they will provide money in a form roughly equal to the amount that would be paid by way of social security benefits in the event of unemployment It is my guess that that is another formula or apparatus which the Government will use to try to ameliorate the worst excesses of the increasing dole queue.
But that will not resolve the problem. We shall come back at a later date, when we reach a new plateau of unemployment, to the crucial and critical question whether it is time for a Socialist Government to resolve the problem in the only way that a Socialist Government can resolve it. and that is to take over the commanding heights of the economy. By that I do not mean moving into British Leyland because it is falling apart, but I do mean moving into manufacturing industry before the whole lot falls apart.
That is one of the crucial issues that we shall have to face shortly, and that is why Conservative Members who appeared to be quite pleased at what I was saying during the earlier part of my speech are not happy about the conclusion that I have drawn from the present state of affairs.

Mr. Victor Goodhew: If the hon. Gentleman would like to see the Government take over manufacturing industry, what does he think will happen about the payment of workers in these industries if the articles which they manufacture are no longer economically priced and cannot be sold in world markets? Will not the wages of these workers be dictated, as they are, by trade unions in

Moscow where they are part of the Government machine?

Mr. Skinner: The hon. Member must appreciate that I am not the most fervent admirer of the way in which the Soviet system operates. I am a great libertarian. But I believe that the Socialist way of operating the economy is superior to the one that we have had since the industrial revolution. All that I suggest, not in a naïve, wide-eyed or innocent way, is that my hon. Friends will come to that conclusion later rather than sooner. I would urge them to get there a little sooner, but I do not believe they will. The hon. Gentleman need not imagine that I and that small number of my hon. Friends who hold similar views will take over control of the Government Front Bench. He need have no sleepless nights; it will not happen. But we shall continue to return to this matter.
There are only two ways of operating the system. One is usually spelt out in clear economic terms by the hon. Member for Oswestry (Mr. Biffen) and the other is the one that I have been relating. But since the war, both Governments, by a series of similar measures which have been packaged differently and wrapped up in different coloured paper, have seen the propping up of the private sector as necessary and acceptable. Throughout, after all the pampering, the regional grants and other props to private industry, we have still reached our present situation, which will become even starker in the years ahead.
Most hon. Members believe that we should opt for the consensus approach towards the economy and carry on propping it up, but I do not get terribly excited about that. I accept it. But I know that in the end—God knows when that will be—another view will prevail, one which says that we cannot continue pumping £4 million of taxpayers' money each day and every day into the private sector without getting some return.
My right hon. Friend the Secretary of State for Industry, who has changed his stance on economic matters, among others, and who is not present today, is beginning to appreciate these points. That is why the Press is a little frightened of the way in which he described how the system fails to provide the necessary jobs. That is the grim portrait that we


have before us, and it will become even grimmer. If the consensus view prevails, there will be a rundown in steel to the extent of 30,000 jobs, perhaps even more, in areas which are largely, though not entirely, areas of high unemployment. The same is true of other manufacturing industries, such as textiles which is suffering not only from the effects of EEC entry but from dumping.
Even in mining the picture is not as rosy as some people believe. I am glad that the training schemes are full—even to the point that school leavers cannot get into them—but the picture is still not as good as it should be. We should be producing as much coal as is humanly possible, mainly for the power stations, where well over half our product goes. As we are told by the Midlands miners, instead of running down the costly oil-fired power stations in the face of the decrease in demand caused by the number of unemployed and the lack of growth in the economy, we are cutting out the coal-fired stations, although their thermal efficiency is greater. If we used coal-fired power stations to the maximum, we could employ even more young people in mining.
Another surprising thing about this debate is the way in which it was introduced by the right hon. Member for Lowestoft. The only time that he livened up was when I tried to install some enthusiasm into what—

Mr. Cryer: It was an insipid speech.

Mr. Skinner: As my hon. Friend says, it was insipid. But one thing that the right hon. Gentleman said alerted me. He talked about Operation Eyesore, introduced by the last Tory Government as a marginal measure to soak up unemployment. In February 1972, a million men were on the dole. That is the biggest figure since the war. It was the last plateau that we reached, although the next is probably not far away.
To abate unemployment by a marginal device, as Governments do in preference to tackling the problem head-on, the Government introduced Operation Eyesore and urged local authorities to use it to mop up unemployment. It has gone now, but in Clay Cross, the town in which I live, the council carried out the

instructions of the Secretary of State for the Environment of that time, the right hon. Member for Worcester (Mr. Walker). Because those councillors had the audacity to employ people on Operation Eyesore cleaning up rivers and brooks, moving oil drums and cleaning up the hedgerows, they were surcharged £30,000 by the district auditor only a few weeks ago. I am glad to see that the right hon. Member for Worcester has just come in.
Those Clay Cross councillors were doing something practical about unemployment, not just talking about it, as many hon. Members do. They were doing what they believed to be right, not because of Operation Eyesore but because they knew that it had to be done in an area where unemployment was 20 per cent. and seven pits had been closed in the previous three or four years in a radius of five miles. As a result of the action of a non-elected bureaucrat who received more in wages than any of the people employed by the Clay Cross councillors, they have been surcharged £30,000 for that item alone.
That is a disgrace and a scandal. About 100 of my colleagues have signed the recent motion that I and others put on the Order Paper, but if hon. Members are really concerned about unemployment they will all sign it and condemn the auditor for attacking those people for getting rid of unemployment in a practical way.
So that was Operation Eyesore. Those councillors got a black eye for their efforts. So when any other Government, including the present Government, send out circulars urging local authorities to mop up unemployment because they regard it as a social disease, I hope that they will send out a circular to all the district auditors telling them that councillors have not only the right but the duty to resolve some of the worst community problems, and that they have been elected to deal with just those problems.
The worst feature of this debate is the question of the Common Market. So many times in the years preceding that awful decision of 28th October 1971 and since have I heard the romantic stories about how wonderful our entry would be—not for us but for our children and our children's children. Two and a half


years later more young people than ever are on the dole and the prospects are even worse.
That is an indication of the benefit to young people of our membership of the Common Market. I suppose that we shall now be told that it will be the next generation but one that will benefit. With a trade deficit of £2,000 million, as announced by my right hon. Friend, and with the trend rising to £2,400 million this year, I shall not be surprised to be told that. There are likely to be even more young people unemployed. With hundreds of thousands of people coming from Southern Europe, Turkey, and so on, to work in Central Europe, especially West Germany. producing at slave labour prices, it is likely to be our young people who will suffer. Yet hon. Members talk in riddles on the subject of the Common Market. The right hon. Member for Lowestoft was too ashamed even to mention the Common Market.
My message to young people compelled to be idle is simple. They might be idle now, but I hope that each of them will work full time on 5th June to say "No" to Europe and "No" to the dole queue.

5.42 p.m.

Mr. Clement Freud: It is no easy job to follow the hon. Member for Bolsover (Mr. Skinner) and it is a task that has not previously befallen me. Had it been his maiden speech and I had been compelled to say that we looked forward to further contributions from the hon. Gentleman, I might have had myself to blame for future outbursts.
The subject that we are discussing today and from which I think we departed for the last 20-odd minutes is the employment problems—

Mr. Deputy Speaker: Order. If the hon. Member for Bolsover (Mr. Skinner) had strayed from the subject, I should have pulled him up. This is a very wide debate. If the hon. Member for the Isle of Ely (Mr. Freud) had listened to the last 20 minutes as I have, he would have realised that it was a very wide debate.

Mr. Freud: Thank you, Mr. Deputy Speaker. I saw you twitch in your Chair on several occasions, even as we on the benches twitched.

Mr. Skinner: Get it read out and have done with it.

Mr. Freud: As I was saying before the hon. Member, as ever, spoke, the subject of the debate is employment problems and prospects of school leavers. I appreciate that unemployment is a serious problem, but in the first instance our concern should be to ensure that this unemployment be spread reasonably evenly.
There are 2 million people who, to all intents and purposes, are illiterate, 2 million people with a reading age under nine. It is important when looking at the general picture that we do something to see that these people who leave school particularly disadvantaged have a chance of gaining employment. It is they who in periods of high unemployment are always the last to get any sort of job, and it is they who, by virtue of their limited education, have little job mobility and even less job security.
On a number of occasions I have tried to introduce a Private Member's Bill and a Ten-Minute Bill to amend the raising of the school leaving age. It is still my contention that leaving school at the age of 16 is very nearly too late to take up an apprenticeship. Leaving school at 15 gives three or four years without feeling, at the age of 19, that one is too poor to hold up one's head amongst others who work.
One of the subjects that has to be looked at in the context of this debate is that of careers officers. In the reorganisation mania of 1974, careers officers, who were previously under the Department of the Environment, were taken under the wing of local education authorities. The officers employed by the Department of the Environment remained in that Department doing other work, and the education authorities advertised for what were virtually non-existent people. However, they have come forward. Their work load is immense and their salary is pretty poor.
The careers officer in the Isle of Ely deals with between 1,000 and 1,500 school leavers every year and receives £3,000 per annum, a sum that some of the young people he puts into jobs achieve after two years of employment. Enormous tribute should go to these careers officers, who are doing valiant work. It is they who are particularly concerned about the


prospects of those who leave secondary education with less than the requisite number of O-levels and CSEs.
As a nation we have tended to favour those who stay on at school with very much more generosity than those who leave. I do not want to say, because I think that it would be wrong to say, that anyone is getting too much money, but, to go back to the proverbial national cake, the slice that goes to those who go to universities, polytechnics and colleges of further education is out of all proportion to the puny amount spent on training youths who go straight into industry.
This is where the Government could make a major contribution. I realise that there are already training and retraining schemes. However, in France and Germany the average person who wants to retrain for other employment because the jobs in his area do not give sufficient scope may apply for a retraining scheme at any age, not 19 as is the limit here, and be accepted at almost any place unconditionally. During training he receives 80 per cent. of the salary that he received before deciding to go into another job. That is his retraining stipend. That is the sort of scheme that we need in this country.
In 1964 unemployment was 1·5 per cent. and was pretty evenly spread, school leavers providing 1·6 per cent. of those figures. In 1972, the last year when school leavers were taken as a separate entity, there was 7·6 per cent. unemployment among school leavers, compared with a national average of about 4½per cent. The ratio is rising. There are more and more school leavers who are unable to find employment.
What must be done—and there are obviously many things that must be done —is that the training service agencies must increase and encourage the development of employers' training schemes. The Government's training contribution should be very much more flexible in order to meet the needs of the high unemployment areas.
Local education authorities have to realise that education is part of preparation for life. They must link education with courses which will allow people to go into local employment.
Employers should adopt a more realistic attitude towards entry qualifications which are based far too much on tradition. There is no reason why a school leaver should not be considered for a vacancy even if it means driving a tractor on the land, for which is needed intelligence but not a great deal of driving experience. There are so many jobs which traditionally are given only to certain people, in certain ages and of a certain sex. There is no good reason for that except tradition.
The Minister spoke with a good deal of sympathy and understanding about the plight of the young unemployed. I am sure he realises that what is going on at present is a considerable amount of buck-passing between Government Departments, between the Department of the Environment and the Department of Education and Science, and between the local education authorities, training boards and training centres. The Government have to be told in no uncertain fashion what so large a majority of these school leavers have had written on the piece of paper with which they left their last place of formal education—"Must try harder". I call on the Government to do so—now. They have already tried but they must try harder.

5.53 p.m.

Mr. Edwin Wainwright: I was deeply surprised and very much concerned to hear the opening words of the hon. Member for the Isle of Ely (Mr. Freud). Too often we hear that children are leaving school too late. People want children to start work early. It used to be at the age of 12, then 13, then 14, 15 and now 16. I wonder what the hon. Gentleman thinks will happen to the training and education of such children who have to live in the society of the future and face competition for all kinds of jobs.

Mr. Freud: My attempt to amend the school leaving age was never meant to take people away from the umbrella of the local education authority. It was to allow young people greater flexibility so that they might enter an apprenticeship, undertake day-release courses or linked courses, thus continuing their education but not necessarily within the four walls of a secondary school.

Mr. Wainwright: The hon. Gentleman has not given much consideration to his


suggestion. That is one of the difficulties. There are already too many dead-end jobs for our young people when they leave school at the age of 16. If we compelled employers to take more young people at the age of 15 there would have to be a subsidy to ensure that the jobs were there. There is a great deal of airy-fairy talking on this subject.
We ought to study the education system in the United States of America. There most boys and girls go to school until they are 21. In this country, the figure for young people remaining at school until 21 is 1 in 15. The United States produces two and a half times as much as we do. Education provides the wherewithal. The better the education system the more productive are the people. They utilise their ingenuity and compel employers to introduce more sophisticated methods, like automation.
I am not sure that we have the right departmental Ministers here to deal with this problem. The employment exchanges throughout the country do their best to find our young people employment but at times of recession they have great difficulty. There needs to be co-operation between various Departments to ensure that the jobs are there. It is hardly fair on my hon. Friends from the Department of Employment that they should have to answer this widespread debate.
Recently I tabled a Question about the number of youths who were unemployed 12 months ago. It was a Written Reply, and perhaps I should be a little embarrassed because the figure I was given was "one". That has grown since then. There is a special problem for the young people in my area. If they want good jobs they must travel to Sheffield or Doncaster or even further afield. There is only the mining industry and one or two large factories in the immediate vicinity.
Although it is only a temporary organisation, Community Industry has done a tremendous amount of good work in my district. Those in charge are doing magnificently. They do their best to ensure that a good proportion of the boys and girls employed are those who would have difficulty in obtaining work because of some impediment or lack of training. In one instance a deaf boy was employed and trained in a useful occupation. I

understand that many of the people trained there had previously found it impossible to get a job.
There are three different training courses, lasting 13 weeks, 26 weeks and 39 weeks respectively. There has been a slight mistake at my local employment exchange, I have been told, and my hon. Friend will be receiving a letter from me on this issue. When some girls went to sec about the courses they were told about the 13-week course. They felt that the final pass standard was rather high for a 13-week course. Later when they questioned the employment exchange further they discovered that there were the two other courses of 26 weeks and 39 weeks. They had not been told of these courses earlier. They would have preferred to take one of these. Now they cannot take another course for at least five years because they have taken the 13-week course. I hope that my hon. Friend will ask his right hon. Friend to look into this.

The Under-Secretary of State for Employment (Mr. John Fraser): I can understand my hon. Friend's concern. Perhaps he will excuse me if I do not deal with that point in my reply, but I will look into it most carefully.

Mr. Wainwright: I thank my hon. Friend.
I come now to the subject of office work in South Yorkshire. We have pressed on the Government that some of the Government Departments or offices dispersed from London should go to South Yorkshire, but our area has not been favourably considered. The relocated Government employment either falls well below South Yorkshire or flies above us into the clouds and drops down further north. Some of our young people should be able to obtain work in Government Departments. I hope that my hon. Friend will bring pressure to bear on the appropriate Government Department with this end in view. There are useful sites in the Rotherham. and Sheffield district on which offices needed for relocated Government Departments or offices could be erected.
There is limited employment in South Yorkshire for our young people. When the recession is over and the economy starts to thrive, I ask that consideration be


given to building a large motor car factory in South Yorkshire. It is a disgrace that our young people have such difficulty in obtaining jobs and that unemployment is at its present level. The greater the level of general unemployment the more difficulties our young people have. Further, those who are in some way disadvantaged but could be employed in a thriving economy get pushed further and further into the background.
I hope that the Government will find a solution to the present economic situation. Jobs should be provided for all people. No youngster should leave school unless he enters an apprenticeship or embarks upon some training of a type to ensure that he has a secure future. It is estimated that before the end of their working lives those youngsters now entering employment will change their jobs at least three times. That is why basic training is so important.
It could be said that the problem is aggravated by factories closing. No one can find a solution to the problem. For at least two decades there has been insufficient investment; and both Governments are to blame for this. Private enterprise should not criticise nationalised industries on this account, because private industry, too, has failed to invest sufficiently.
We want industries that will produce goods which we can sell abroad to pay for our imports of raw materials and food. Unless we have an enlightened, well-trained work force who are aware of the responsibility which will be required of them in their jobs in the future, we shall fail. I hope that the Government will do more than they have done in the past, although I know that my right hon. and hon. Friends have it in their hearts to do their utmost to ensure that jobs are provided not just for the young but for the benefit of all who need them.

6.5 p.m.

Mr. Esmond Bulmer: I agree with the hon. Member for Dearne Valley (Mr. Wainwright) about the overriding need to invest in the interests of the next generation.
On 22nd April I asked the Under-Secretary of State for Employment what evidence he had received

on the outlook for jobs for those who will leave school at the end of the school year. If it is the same as the evidence I am getting in my constituency, the outlook for those leaving schools is as bad as it has been at any time within the past 10 years.
The Under-Secretary replied:
When unemployment rises, young people tend to suffer disproportionately more than others."—[Official Report, 22nd April 1975; Vol. 890, c. 1214]
The Under-Secretary went on to say something about what the Government intended to do, but he did not say that this was a situation he could not tolerate and the Government could not tolerate.
However, the Under-Secretary told the truth. It is true that young people suffer disproportionately. As my right hon. Friend the Member for Lowestoft (Mr. Prior) said, this has recently been documented in the National Youth Employment Council's report "Unqualified, Untrained and Unemployed". The council found indications of a long-term trend for young people to be hardest hit at each downturn of the economy. We all know that the spiral is getting worse. As inflation goes from a two to four multiple to a four to eight multiple to an eight to 16 multiple, we can expect the unemployment spiral to follow in just such a disadvantageous way.
We in the House have a vested interest in the next generation. They are in many ways the most vulnerable and most impressionable. They are the people on whom we in our turn will come to depend. If a young person obtains employment and there is redundancy in his firm, on the basis of "last in, first out" he is the person who will suffer.
Consideration should be given by the trade unions to producing a code of practice which reflects a more mature outlook and which takes account of such considerations as bachelor versus married man and young versus old. The young certainly are impressionable. If they get into the wrong job straight away, or if they have the wrong supervision, they can be alienated for life. There is a growing contrast between what they are receiving and their aspirations.
The Minister rightly said that there is a need for constant reassessment. We know that the sum of knowledge is doubling perhaps every 10 years. We must all go back to school and re-educate ourselves continually. There is now some


understanding of this in industry. Those of us who work in companies are tied, perhaps, to an out-of-date code of law which demands that we make a profit first and which says that that is our fundamental responsibility. As our thinking develops, and as there is clearly far less to be paid in wages, with the way things are going at present, we must all turn to meeting some of our other aspirations which are, not for higher wages, but for better jobs and jobs which provide greater fulfilment.
I hope that the steps management is taking will be recognised by all trade unions. Some trade unions already recognise these steps. It would be nice to think that there were more disciplines such as those that, perhaps, an IBM computer aptitude test provides in a company. It may well be discovered that if everybody in a company takes such a test there is numeracy to be found in people where it is quite unexpected. There is still the tendency to regard people as fixed for all time in a particular job. We clearly need a greater mobility in attitude, just as we need greater mobility in moving from company to company.
I have said that we shall depend in our turn upon the rising generation. We shall depend upon them for our pensions, for exports, and for our standard of living. If we ignore them and treat them worse than other sections of the community—as we admit is happening at the moment—we shall have only ourselves to blame if they are less sympathetic to our problems when those problems catch up with US.
How shall we reduce these risks? The Minister has said some sensible things about counselling. The Central Youth Employment report headed "Looking Forward to Work" put forward two horrifying statistics. Only four in 10 of those leaving secondary school received any formalised career advice. Only one parent in 10 actually went along to the headmaster of the school to talk about what career his son or daughter should follow. There is an enormous task to be dealt with in this area.
In my constituency, which has hitherto enjoyed very stable employment, the outlook is probably the worst for young people that it has been since the war. In engineering there has been a notable

reduction in vacancies. In building and construction there has been a notable reduction, and in carpet manufacturing a slight reduction, in the number of vacancies for boys, with a large reduction in the number of vacancies for girls. In shops, there has been a substantial reduction; one large store has recruited nobody since January. Vacancies are two-thirds down on last year. If we look at the prospects for the 700 people who will be leaving school in July, whereas this time last year there were 400 vacancies there are at present only a handful.
When the Minister replied to my Question he went on to say that the Chancellor had announced an increased grant in aid to the Manpower Services Commission and that young people will benefit from the strengthening of the employment and training services. As yet there is no evidence of this in my constituency. We have an excellent college of further education, which has the facilities to produce courses, if it were given the go-ahead in June, for those who cannot find jobs in September. The courses could be open-ended, so that when a job has been found, by one of the people doing the course, the course could be contracted in line with the successful finding of the job. I emphasise that we would want a decision on that matter in June.
Coming closer to home—although this is not the Minister's responsibility—we hope to have a carpet design course. Kidderminster has increased its exports —as the hon. Member for Bolsover (Mr. Skinner) will be delighted to learn—to the EEC from £5 million in 1972 to £27 million in 1974. Naturally, we want to take advantage of this and to expand our design centre. At present we are subject to substantial bureaucratic delays. I have a letter from the principal who says:
It is very unfortunate that the procedural system is so lengthy that it will be very difficult, to start the course in September, although I am still hopeful that it may just prove possible.
Therefore, any help that the Minister or his colleagues could give us would be much appreciated.
The way to turn round these prospects is clearly to give stimulus to industry. It is difficult not to be provoked by some of the things said by the hon. Member for Bolsover, but so many industries and so many companies in those industries have found themselves deprived


of the cash they need by the operation 01 the Price Commission. I know of one company which got caught in the worst possible way. The price of raw materials doubled in a month and it discovered that it could not put up its prices just before the main selling season, so its short-term loans rose from £3 million to £9 million and it was in the position of being technically insolvent within three months. The Government must look at this situation. Something must be done to relax the rules.
There is no doubt that in my constituency a great many of the larger employers will turn round and say that they cannot recruit more people because they cannot be certain that they can run their own businesses. With the present rate of inflation, and with the Price Commission operating in the way that it is, if they are to preserve the jobs of the people whom they employ they cannot afford to take any risks at all and, therefore, quite naturally, they are cutting back.
There is clearly a lot that the Government can do in the nationalised industries to develop manpower strategies. My right hon. Friend the Member for Bournemouth, West (Sir J. Eden) referred to the Armed Forces. Many of them provide a useful break for young people to see something of the world and to develop a trade at the same time. I hope that this will be further encouraged.
I hope that when the Minister winds up he will say something about the need to restore to private enterprise the ability to manage its own companies and to feel that, if it takes decisions to recruit people, it will not be prejudicing the jobs of those already employed. I hope that the Government will consider the development of manpower strategies of the nationalised industries, and say something of comfort to my constituents.

6.15 p.m.

Mr. Leon Britton: This debate has shown hon. Members' appreciation of the gravity and the dimensions of the problems facing school leavers and their concern that practical steps should be taken to deal with those problems. There has been some divergency as to the magnitude of the problems. The Minister of State has told

us not to exaggerate, but from such different points of the compass and different political viewpoints as those represented by my right hon. Friend the Member for Bournemouth, West (Sir J. Eden), the hon. Member for Houghton-le-Spring (Mr. Urwin) and the hon. Member for Bolsover (Mr. Skinner) a rather more gloomy picture has emerged.
There is a long-term problem and an especially acute problem this year. As has been shown from the recent report, vacancies for young people have tended to drop by 6 per cent. between boom and recession years, but the number of vacancies has failed to rise again to restore former levels. In addition, the situation becomes more serious when the working population between 15 years and 17 years is expected to increase again from 2 million to 2·75 million by 1980. Of course, young people are especially vulnerable to cyclical factors in the economy.
The situation is well illustrated by the figures on the register this year for Cleveland county—a typical northern industrial county—which show that there are 1,052 teenagers on the register compared with 446 last year, and 274 vacancies, compared with 972 last year. As my right hon. Friend the Member for Lowestoft (Mr. Prior) has already said, 70 per cent. of the unemployed young are unqualified and untrained and are likely to get jobs below or at craft level. Indeed, the fact that such people are particularly disadvantaged, and that people such as the disabled and members of the black community are even more disadvantaged, was stressed by the hon. Member for the Isle of Ely (Mr. Freud).
It is a tragedy if young people face life at the outset of their career as unemployed people. If one starts life without a job, it is likely to affect one's attitude towards life and work ever afterwards and to encourage anti-social tendencies. As my hon. Friend the Member for Liverpool, Wavertree (Mr. Steen) said, the effect is to cause young people to turn on to society instead of to turn into society, and to feel rejected.
What do we do in a situation such as that? A number of suggestions have been put forward, many of which are constructive. I hope that I shall be forgiven for not regarding it as a practical suggestion that the motor industry, in its


present difficulties, should be started up in a variety of favoured areas. As Frances Cairncross pointed out in The Guardian, the future of a modern economy would not be best served by the starting of new motor industries in places which do not already have them.

Mr. Edwin Wainwright: To say "When the recession is over, will the Minister consider the matter?" is to put it very unfairly. I appreciate that it is not the right time to start such a project. In any case, it would take quite a few years to build up.

Mr. Brittan: I agree, but I am more sceptical about the prospect of that solution even when the recession is over.
If we are to solve the problem, we must first have the full facts. I ask the Minister to say whether the Government will do what the Institute of Careers Officers has asked and reintroduce the publication of separate monthly figures for unemployed teenagers. It is not sufficient to publish monthly the figures of school leavers and twice a year the figures for unemployed teenagers. On 22nd April the Minister said that consideration was being given to this matter. Is an answer available?
However, information is not sufficient. Urgent action is also required in the short term and in the long term. In the Budget, an announcement was made of an extra £20 million to be given to the Manpower Services Commission. I should like from the Minister an answer to the question posed by my right hon. Friend: on what will the money be spent, and, in particular, how much of it will be related to work specifically for young people?
A number of constructive possibilities have been highlighted in this debate. The contribution of Community Industry stood out. We heard how 5,000 young people have been working in Community Industry. Tribute to it was paid by my right hon. Friend the Member for Bournemouth, West and by my hon. Friend the Member for Wavertree. We were told that it provided real hope and that the work given was seen as a job and not just as a service and that it played an important part in developing personal relationships for the people involved.
Will the Minister give the green light for Community Industry to recruit above the 2,000-employee limit? The Minister

of State said that Community Industry is to be continued. I hope that the Minister who concludes the debate will say whether it will be expanded. Will he agree to the proposal of the management board of Community Industry that the original experiment can be expanded to include a whole new range of approaches such as the organisation of work experience schemes? We shall want to know the answers to those questions because upon them depends the short-term policy on this grave problem. The scheme in Canada so vividly described by my hon. Friend the Member for Wavertree plainly will require long-term examination, but I hope that the House will have at the earliest date the result of the foray into Canada of the members of the Department who went to see how that scheme was getting on.
The Manpower Services Commission referred in its report to the value of work creation. Although one must be careful of palliatives, and although the scope is not unlimited, surely there is scope at a time of rising unemployment for expansion of schemes such as Operation Eyesore, which was described in denigratory terms by the hon. Member for Bolsover.

Mr. Skinner: rose—

Mr. Brittan: I shall not give way. The hon. Gentleman knows that if I do not give way he must sit down.

Mr. Skinner: rose—

Mr. Deputy Speaker: Order. We must have one hon. Gentleman at a time. If the hon. Member for Cleveland and Whitby (Mr. Brittan) does not give way, the hon. Member for Bolsover (Mr. Skinner) will have to restrain himself.

Mr. Skinner: On a point of order, Mr. Deputy Speaker. When I referred to Operation Eyesore—and you were present at the time—I made it abundantly clear that I was not complaining about—[HON. MEMBERS: "It is not a point of order."]

Mr. Deputy Speaker: The hon. Gentleman must not seek, by means of a point of order, to make the point which he would have made if the hon. Member for Cleveland and Whitby had given way.

Mr. Brittan: The hon. Gentleman has had the benefit of addressing the House—

Mr. Skinner: On a point of order, Mr. Deputy Speaker. The hon. Gentleman said that I had referred to Operation Eyesore in denigratory terms. I made no such charge. What I was suggesting was that—

Mr. Deputy Speaker: Order. That may well be so, but it is not a point of order.

Mr. Skinner: I have got it on the record.

Mr. Brittan: That is quite a lot on the hon. Gentleman's record, and hon. Members will be glad to hear what he has said.

Mr. Skinner: I am proud of it as well.

Mr. Brittan: I wish to ask the Minister whether adequate use can be made of the spare capacity in apprenticeships which is likely to exist this year. What is the latest estimate of the vacancies likely to occur, and can there be sponsored apprenticeship on the lines of the training award schemes we have had in previous years?
I know that the disadvantage of that is thought to be that sponsored apprenticeships discourage employers from taking on apprentices, but many employers have already made it clear that they do not propose to take on as many apprentices as they have done in the past. In those circumstances, the disadvantages surely are outweighed by the advantages of using the facilities which are provided for apprenticeships, otherwise those who would take apprenticeships would take instead jobs which could go to people with lower attainment who suffer most from the problem of youth employment.
However, the Government should be addressing themselves to the long-term problem. I have a number of questions on the long-term problem which I should like the Minister to deal with. The clearest statement of conclusion reached by the working party of the National Youth Employment Council in its pamphlet entitled "Unqualified, Untrained, and Unemployed" was this:
All young people should in the initial years of their working experience be regarded as trainees and they should have systematic further education.

Is that a long-term policy which the Government are prepared to regard as an official commitment? Many concerned in this area would like to know whether it is.
The problem of the young and their employment prospects must be considered from the time that they are at school. Reference was made by my right hon. Friend the Member for Bournemouth, West to the facilities in school being used after school hours for employment purposes. I hope that the Government will give that constructive suggestion careful attention when they consider their policy. I hope that they will also give attention to the proposal in the pamphlet to which I have just referred that more careers material should be provided in simple language backed up by audio and visual aids.
Another recommendation made in the pamphlet which I hope will be carefully considered is that there should be special courses in literacy and numeracy in colleges and elsewhere. The study found that employers were horrified at the inability of many young employees to read even such matters as safety instructions—a conclusion which the House may think supports the views expressed by my hon. Friends about the need for the reintroduction and maintenance of monitoring standards in education for the basic skills. I hope that the implication of the report will not fall on deaf ears on the employment side. Similarly, the proposal that there should be a junior training opportunities scheme—a proposal which was commended by my right hon. Friend the Member for Bournemouth, West—needs to be answered at a fairly early stage.
A matter which is of great importance in long-term planning policy is the central constructive recommendation for a scheme for preparing young people for employment by means of residential courses, continuous assessment and carefully graded tasks. That would be a major commitment, but I hope that the Government can at least give their preliminary thoughts on whether they are prepared to back the scheme and to give it their support.
The Minister of State referred to linked courses between schools and colleges and


help in the transition between schools and colleges. That is a matter to which it is easy to pay lip-service. I am sure that the Government are sincere in their belief in the importance of such help, but it would be easier to believe that the Government had a credible strategy in that area if they were able to give us rather more detail of what they have in mind for the future of such schemes.
I suggest that we can genuinely consider the cost of training and matters of that kind as an investment. It is an investment that is far more valuable than the attempt to protect existing jobs at all costs. The Minister sought to defend the Government's policy of protecting existing jobs at all costs and he referred with pride to the Government's activities as regards British Leyland. I suggest that that is a self-defeating policy. To maintain existing employment by throwing in more and more of the taxpayer's money may sound a charitable and merciful operation, but in the end there will be a limit to the amount of money that the taxpayer is either able or willing to spend.
I have a horrid vision of a weaker and weaker Exchequer making increasingly desperate attempts to prop up increasingly out-of-date industries in a vain attempt to freeze the existing pattern of employment. Surely there is a constructive alternative to that approach. I suggest that the alternative is to educate and train young people to engage in constructive and relevant work in modern and expanding industries. It is with that end in view that we have initiated this debate.

6.32 p.m.

The Under-Secretary of State for Employment (Mr. John Fraser): It would be remiss of me if I did not begin by congratulating the hon. Member for Cleveland and Whitby (Mr. Brittan) on what I think was his maiden speech from the Front Bench. I say sincerely that we shall look forward very much to hearing him speak again from the Front Bench. He has spoken with knowledge and care and I am sure that the whole House appreciated the contribution which he made.
I have been asked a number of questions which are not directly the responsibility of my Department. If I do not answer all the detailed points I shall certainly study the matters which have been

put forward in the debate. I start with the suggestion which was put forward on 22nd April at Question Time that we should have more regular publication of the teenager unemployment figures. I cannot add to the answer I gave on 22nd April. The idea of more regular publication has its attractions and I am studying the matter urgently. I shall make an announcement as soon as possible. Other detailed points concerned the siting of the National Shipping Corporation and the prospective Government offices in Dearne Valley. The advance building programme was also raised. I cannot give detailed answers to those matters but I shall bear them in mind and where appropriate I shall pass them on to another Government Department.
My hon. Friend the Member for Bolsover (Mr. Skinner) raised a rather wide point and I do not feel that it would be fair to deal with the detailed matters involved. I feel that if my hon. Friend and I were to swop election addresses he might find that we were rather closer together than he imagines. I say that in view of some of the things my hon. Friend said about his own Front Bench.
A serious problem for all Socialists is that public ownership does not of itself mean that we have resolved all our problems. I am sure that my hon. Friend is keen, for example, on the nationalisation of the banks and insurance companies. I am sure that that is amongst his proposals, and it is an idea with which I have some sympathy. If we considered that proposal purely for the sake of argument, it might well be found that such a programme would lead to a contraction of job opportunities in the same way as nationalisation and public ownership in other areas can lead to contraction of job placement. I hope my hon. Friend will excuse me if I do not take the matter further than that. Public ownership should not be regarded as a panacea for all our problems.

Mr. Skinner: I agree with my hon. Friend's argument that public ownership does not necessarily provide more jobs I agree that in some instances it would not be efficient if that were the case. However, we are currently finding that the propping up of the capitalist system is becoming increasingly expensive. The system is not now providing jobs. If we had proper


control and if we occupied the commanding heights of the economy, including some of the industries which my hon. Friend has mentioned, the State would be in charge and would be able to plan and control. It could then ensure that loss of jobs did not arise out of the pure exploitation of the working people.

Mr. Fraser: I hope that my hon. Friend will concede—I am sure that the Opposition will do so—that we are making reasonably good progress during this Session.
I return to the detailed subject of the debate—namely, unemployment. Whether unemployment is applied to the young or the old, it is a corrosive disease which robs people of pride, dignity and a sense of security. As most hon. Members have said, it is particularly disturbing when unemployment hits the school leaver. The burden of unemployment is not one which falls evenly. The prospects for the future are daunting in terms of vacancies for young people. The school leaver suffers disproportionately when we face a recession. Of course, there are other people who are hit in a similar way—for example, the disabled, ethnic minorities, people in the development regions and the older worker.
The tragedy for the school leaver is that his expectations and ideals are blunted at the very moment when he should be able to begin to realise his potential, at the time when he comes out of school with bright hopes and with the idea of applying what he has learnt at school. He can be disappointed by his first experience of the adult world.
It is even worse than that. The effects of unemployment are felt not only by school leavers but all the way down the line. They are felt even by those who are still at school. When they see the experience of their older school friends, they sometimes think that it is not worth while making the effort I must say to them that they are absolutely wrong in taking that attitude. One thing that becomes very clear is that lack of attainment at school means a greater chance of lack of attainment at work. To believe that it is not worth while making the effort is the wrong attitude to take, but we must not underestimate the effect of

unemployment both inside and outside school. Anyone who represents an area with a large black population will understand exactly what I am saying. It is a problem that is very much a challenge to a caring society.
I do not think we need debate the reasons for rising unemployment. The reasons are not limited to this country and arc to be found in commodity prices. I do not think that it would be productive to debate that further.
The Govenment are prepared to take the necessary measures. We have been prepared to take them in the past. Certain measures have been taken by means of the Industry Act 1972 to deal with ailing firms, and notably with the British Leyland Motor Corporation. I emphasise that 800,000 jobs turn on the viability of that corporation. The setting up of the National Enterprise Board is an important contribution to providing investment and job opportunities. It will assist in providing jobs where they are most needed. One of the purposes of the NEB will be to exercise the functions of maintaining and safeguarding employment in any part of the country.
Conservative Members are today berating unemployment, but no doubt in Committee tomorrow morning their colleagues will be berating the very measures that we intend to put through to deal with the long-term causes of unemployment. In successive Budgets my right hon. Friend the Chancellor has resisted the proposition that unemployment should be an instrument of economic policy. My right hon. Friend in November took action, which was criticised in some quarters, to increase the cash position of companies. That action has saved jobs over the winter. We have doubled the regional employment premium and strengthened IDC control to assist the regions.
On top of programmes already planned, the Government are preparing measures to strengthen and accelerate the growth of the training programme, to introduce special measures of training for the unemployed, to improve the efficiency of the Employment Service Agency—any hon. Member who has a job centre in his constituency will welcome what is being done—and to provide additional incentives for job mobility. In case unemployment increases sharply, a contingency plan is


being considered for special payments to firms in areas of high unemployment if they are prepared to defer planned redundancies.
I was asked about the job creation programme and whether the Manpower Services Commission and the Department, following their study in Canada, will be able to build on that experience. The MSC is undertaking more detailed contingency planning for schemes of job creation. This is part of its normal contingency planning against the possibility of high unemployment. The MSC initiative is being undertaken with the knowledge of the Government but at this stage without Government commitment, When the MSC's plans are completed, it will report to the Ministers concerned, who will then take a decision about the viability of the job creation proposals and about when it would be appropriate to put them into effect.
I have read that passage carefully because I hope that it will put on record where the Government stand. This is part of the continuing responsibility of the MSC which reports on these matters and advises the Government on employment and the labour market generally.
Some speakers in this debate have suggested that we are facing the gloomiest prospect for school leavers since the war. I shall not try to make forecasts. I know that the number of vacancies forecast for the future is down. Therefore, I shall not attempt to be prophetic about the situation because that would be extremely difficulty. People who make economic forecasts often go wrong. However, I hope that the House will not take too serious a view about opportunities for school leavers.
Let me give some figures of the situation from last summer. In 1974 526,000 school leavers entered the labour market and the number who immediately became registered as unemployed when they left school amounted to a little over 50,000. Of that figure, 20,000 entered employment in one month and a further 15,000 in two months, and by the end of the year the number still unemployed fell to less than 8,000about 1½per cent. of school leavers.
At Christmas 1974—I refer now to Scotland rather than England—14,000 young people left school for employment

but only a small proportion—about 2,000 —found it necessary to register as unemployed. By March 1975 the number of unemployed school leavers had fallen to fewer than 7,000. In April, however, the figure was increased by 14,000 school leavers in Great Britain who became registered as unemployed out of the total leaving school at that time of 80,000.
Disregarding the Easter leavers, it is estimated that at present there are about 5,000 school leavers whose duration of unemployment has been six months or more and about 1,000 with a duration of unemployment of three months or more. Almost all those people affected by long-term unemployment left school without any recognised educational qualifications. I emphasise that they are at a disadvantage when competing for jobs against better qualified leavers. Their main hope of obtaining settled employment rests either with special help, through training or Community Industry, or in a general improvement in employment prospects.
It is interesting to contrast that figure against the forecast in the Department of Employment Gazette published this week which refers to prospects for graduates leaving university. That publication shows that employers forecast a 25 per cent. increase in job opportunities for graduates against a 10 per cent. increase in the number of graduates. The contrast between the chances for the qualified and the unqualified is so stark that I hope much more notice will be taken of this factor by parents, pupils and by the education system generally.
I now come to unemployment among young people generally, and here I refer to those between 16 and 18. In another context I shall refer to young people between 16 and 25 as opposed to school leavers who are registered unemployed and who have never had a job since they left school. As a result of the Employment and Training Act 1973, monthly statistics of unemployment no longer distinguish between those over and under the age of 18, and it is more difficult to compare trends of unemployment among the young with previous years.
If the number of people registered with careers offices is taken as being broadly equivalent to the number of under-18s unemployed, we see that the level of unemployment among young people has


declined slightly in recent months. Between October 1974 and March 1975 the number of unemployed in Britain among the young fell from 34,000 to 32,000—6 per cent. of the total. That decline, which is encouraging, was most apparent in the regions where unemployment has been particularly severe—namely, Yorkshire, the Humber, the North West, the Northern Region and Wales. In Scotland, which shows a fairly bright prospect and where unemployment has dropped on several occasions recently, the level of unemployment among the young increased, but only because of the registration of Christmas school leavers.

Mr. Prior: The Minister referred to the level of unemployed school leavers in Scotland. Will he give the figure again of those who left school at Christmas and who were still unemployed in April? The figure appeared to be rather severe.

Mr. Fraser: In Christmas 1974 about 14,000 young people in Scotland left school for employment, and 2,000 found it necessary to register at the time—I emphasise "at the time". I cannot give a figure for April analysed separately for school leavers. If I remember correctly from the latest Press release, I believe that, apart from the students who registered in Scotland, there was a drop in the number of unemployed, both young and adult, in that area of the country.
We have done quite well if we take international comparisons. Let me quote the 16-to-25 age group internationally. In Germany between 1973 and 1974 unemployment among the young rose by 210 per cent. In the same period in Denmark the figure rose by 405 per cent., in France by 77 per cent., in Ireland by 121 per cent. and in the United Kingdom by only 13 per cent. Therefore, I repeat that by international standards we have done reasonably well. The year 1974 was not a typical year compared with 1973 because of the raising of the school leaving age, but if we want to take an international comparison we see that although unemployment among the young in our competitor countries rose between 1972 and 1974, there was a drop of about 32 per cent. in unemployment among young people in the United Kingdom between the ages of 16 and 25. Reports from our labour attachés show

that our competitors are faring rather worse than we are. For example, in Germany 100,000 young people are now reported to be out of work.
I return to those at risk and to the measures which the Government are hoping to take to assist. I emphasise that those who left school without any form of education or qualification are most at risk. I hope that the message will be heeded by school careers officers, teachers, parents and most of all by the pupils themselves. This is a most staggering indictment of our educational system and comprises one of the most serious handicaps facing a young person who seeks work. However, I agree with the hon. Member for Isle of Ely (Mr. Freud) that it is wrong to demand unduly high academic qualifications for school leavers. I agree that young people's views about work must he prepared more readily at school.
Despite those facts, I come back to the proposition that obtaining at least some basic educational qualification at school is an important guarantee against unemployment. That is the largest group of people at risk.

Mr. Edwin Wainwright: Will my hon. Friend say a few words about sandwich courses being encouraged more and starting earlier?

Mr. Fraser: Only if I make a sandwich speech. I shall try to deal with that matter if I can.
The second group which is vulnerable to rising unemployment is composed of girls, not because they suffer from more unemployment but because their opportunities are more restricted. Ethnic minorities are especially vulnerable. For instance, the unemployment rate for young West Indians, according to the 1971 census of population, showed that their unemployment rate was about twice that of young men in general. Then there are those who not only have no qualifications but have other disadvantages. I refer to the disabled, the illiterate, the educationally subnormal and the delinquent. The National Youth Employment Council working party document, which I think has been universally welcomed in the House, reported the finding that 16 per cent. of young people registered


as unemployed in November to December 1972 fell into that category. I have no reason to believe that the position is any better today.
Besides those disadvantaged people, the NYEC also found another group within the unemployed who, while not disadvantaged, appeared to lack the characteristics of smart appearance, mental alertness and manual dexterity which careers officers felt were important in the eyes of employers assessing potential recruits. Some 41 per cent. of the young unemployed at the time of the working party survey were regarded as lacking in these attributes and, therefore, at greater risk of rejection in employment than their contemporaries. I am not sure what conclusion we can draw from that, or whether it applies to barbers and so on. I place it on the record that the young are at a disadvantage. The burden falls unevenly, and it is to these groups that we must pay special attention.
I turn to the particular areas where the Government are dealing with these matters, apart from the general measures about which I have already spoken. I start with Community Industry. We have given full support to ensuring the future of Community Industry, whose broad aim is to assist young people to cope more effectively with life in society, in terms both of overcoming personal problems and of making a positive contribution to their communities. I have taken the opportunity of going to many Community Industry schemes. I am enamoured and enthusiastic about what it is doing. I am studying the CI proposals, which were put forward in its annual report. I should like to see, if it is necessary, an increase in places. At present there are 2,000 allocated, of which 1,500 have been taken up. If it looks as though we shall need to go beyond that figure, I should support that in those time-honoured words "with the approval of the Treasury".
As to work experience, again I am enthusiastic about Community Industry experimenting—I must not tread on other departmental toes—in work experience schemes and in furthering work experience, because I think that far too many children leave school without any real idea of discipline and authority or of the

challenge which they will find outside their schools. If a large number of people leave school ill-equipped to cope with the real world outside, in one way education will have failed us. That is why I am keen to teach by experience as well as by precept.
I pay tribute to the people involved in Community Industry. I know that they will appreciate the tributes and commendations made by hon. Members in the debate.
I turn to the rôle of the careers service. Its prime function is to help an individual young person to relate his qualities and preference to career or job choice, to provide information about the labour market and to place young people in employment. We have carried forward the changes in the Employment and Training Act 1973 by making a careers service compulsory and mandatory for all local education authorities.
As regards girls, as a cornerstone we have introduced the Sex Discrimination Bill. In that Bill we shall seek not only to eliminate discrimination on grounds of sex but to open the way for more occupations for girls, whose careers have often been inhibited by traditional attitudes about what is women's work. For those who have special difficulty in obtaining or holding down jobs we have wider opportunities courses, which were introduced in June 1974 on a small scale and, the first results of which are encouraging. Those courses are for people who have difficulty in obtaining or holding down jobs. They have been run so far in Glasgow, Gwent and Liverpool. We are studying the results and may well extend the provision for them.
We have acted on training allowances. Training allowances for young people were increased from 10th April 1975, and the age differentials under the age of 18 have now been abolished. A young person with dependants living at home now receives an allowance of £10·55 per week. I hope that that will provide encouragement for those who wish to take training.
In 1971 there were 15,000 people in TOPS courses. That figure had risen in 1974 to 45.000, of whom about 1,000 were aged 19 or under. I appreciate the comments and the suggestions which have been made about extending the TOPS courses. about whether there should be a


junior TOPS and whether the TOPS age limit of 19 should be applied. I shall examine those suggestions very seriously, in conjunction with my hon. Friends, and I am sure that the proposals will also be examined seriously by the Training Service Agency. That agency and the Government believe that, at a time when employers may drop back on the recruitment of apprentices, schemes such as an apprentice award scheme might help employers to keep and maintain their training effort and are therefore vitally important.
There are difficulties about extending the TOPS scheme in terms of conflict about allowances which are paid to people at universities and other institutions of further education. I assure the House that this matter has been under consideration.
I mentioned the problems of West Indians in deprived areas. Not all West Indians find it difficult to obtain jobs. Many of them do extremely well. However, we are running preparatory courses for those who have had a year or more of full-time education outside the United Kingdom to assist them. The Government have made it clear that the promotion of equal opportunity, irrespective of race, is a vital cornerstone of their policy.
I mentioned the handicapped. The TOPS scheme is open to handicapped people irrespective of any age limit. We are espectially anxious to encourage forms of education and training for those who have physical handicaps as well as the other disadvantages which I have mentioned.
I have described some of the measures which the Government are taking to deal with the problems of school leavers. Perhaps I should finish by saying that the remedy does not lie entirely with the Government. There is a popular view that the Government can somehow do everything. Well, they cannot. The Government can influence affairs and use what power they have, but some of the responsibility for our social condition lies outside Parliament and outside the area of government. For instance, it lies in the motivation and achievement of children at school. That is why I should like to emblazon a message across every school and in at least half of our homes

that the taking of qualifications at school is an important contribution to people's ability to work.
The remedy also lies with those who engage in collective bargaining. Resources which would otherwise be available for recruitment and training of the young must not be pre-empted by bargains outside the social contract. Employers and trade unions have a duty not merely to those in employment but to those who are recruits for employment. The view that other people have responsibilities applies to employers. They must realise that time and time again, in normal times and in boom times, this country has been held back by a lack or shortage of skilled manpower. They must, while looking at their training programmes, look beyond this year's profit and loss account and this year's balance sheet and realise how important training is for the future of industry. I believe that the construction industry and the building societies, as well as the Government, have a responsibility for ensuring a future for our people.
I conclude by saying that it is not that we owe the school leaver a living. We owe him the right to earn his own living. That right to work and to earn a living should be both a precious and an abundant right. Despite the daunting prospects, I am sure that the Government, private enterprise industries, local authorities and the nationalised industries, by getting together, can ensure that that right is given to all school leavers and the young.

Mr. David Stoddart: I beg to ask leave to withdraw the motion.

Motion, by leave, withdrawn.

Orders of the Day — HOSPITAL PAY BEDS

7.0 p.m.

Mr. Norman Fowler: I beg to move,
That this House believes that the abolition of private beds in National Health Service hospitals would be against the interests of the Health Service, the patients and the medical profession.
This is the first of a number of debates which the Opposition will be raising over the coming months on the state of the National Health Service. The reason why we have chosen this subject for


debate today is that newsaper reports suggest strongly that the Secretary of State has decided to go ahead with plans to abolish private beds in National Health Service hospitals. Our aim today is not only to enable an announcement of the plans to be made in this House but to permit an immediate debate on the important issues involved.
Perhaps the House may think it right that, as the mover of this motion, I should declare an interest. I do so quite openly and without hesitation. The only hospital treatment that I have received has been in the public wards of National Health Service hospitals. I have not benefited from private rooms, amenity rooms or side rooms, and the public wards in which I have been have always been occupied by the public—by ordinary people like me and the Secretary of State for Employment, who, we hope, will soon be back among us.
It was the right hon. Gentleman's predecessor, Aneurin Bevan, who decided that a limited number of private beds in National Health Service hospitals should remain. That compromise—for compromise it was—was decided on by a Labour Government, and it has lasted for almost 30 years. It is our opinion that, as so often happens in this country, the compromise has worked, and, furthermore, that it has worked to the benefit of the National Health Service. It is also argued that when the National Health Service is threatened by so many problems the right hon. Lady's action to phase out, or, in plain English, to abolish, private beds is not only dangerously irrelevant but damaging to the interests of the National Health Service.
I assume that no one seriously claims that the total number of private beds is now out of proportion to the size of the National Health Service. There is, of course, some dispute about the number of private beds that are available for use. A recent report in the Daily Telegraph suggested that many beds had been closed down unofficially. If that were so, it would be a most serious situation. The right hon. Lady has had time in which to investigate that suggestion. I ask her to take the opportunity of this debate to state exactly what the position is.
Let me take the official figures, however. According to the Department's

figures, there are now almost 5,000 private beds available. That figure makes up about 1 per cent. of the total number of beds in our hospitals. That is the tiny target which the right hon. Lady is spending so much time and energy to destroy.
What makes the right hon. Lady's action even more extraordinary is that the present compromise enables a number of results to be achieved which I should have thought would be welcomed by both sides of this House. First, it enables specialists not only to make invaluable contributions to the National Health Service but also to preserve for themselves the freedom to practice outside a full-time salaried service. What is more, it allows them to achieve this without the kind of separation facilities which the right hon. Lady seems now to envisage.
Last Tuesday, during Question Time, the right hon. Lady proclaimed her faith in separation. Rather than the present partnership, she wants to have a clear distinction between the private and National Health Service facilities. Yet how is separation in the interests of the National Health Service itself? Surely it is one of the advantages of the present arrangement that many consultants are on hand in the same hospital and are not wasting time travelling between one hospital and another. Although' I accept totally that it would be possible to provide separate facilities, the right hon. Lady must accept that in some cases it would be very difficult, and that the result in the end could be to the extreme disadvantage of the National Health Service.
I take, as an example, cancer treatment. There are obvious difficulties in providing privately the kind of expensive equipment and buildings required. The right hon. Lady knows of the fear and concern, which has been expressed by the London and South-East group of consultant radiotherapists, that cancer specialists, especially radiotherapists, have not made provision to meet a sudden withdrawal of National Health Service facilities because they believed that the compromise would be honoured by successive Governments.
Some consultants, therefore, may find it impossible to continue with private


practice in this country. Therefore, it would not be surprising—I put it no higher, although I believe that the risk is greater—if some were to reconsider their future in this country, not because they want to go but because they may feel that they are being forced out. The question which the right hon. Lady has to answer is just how this could benefit the National Health Service. If consultant radiotherapists and other senior staff want to work abroad there are several countries which would jump at the opportunity of having them. At present, they are receiving invitations and inquiries from abroad, notably from the United States. Some have gone already. Many more are considering that move. What a tragedy it would be if the policy of this Government resulted in the right hon. Lady pushing more consultants abroad at a time when we cannot fill the posts available here.
There is a much more general point. As The Times reported last month, there has been an enormous increase in the number of doctors generally examining the prospects of a career abroad. There has been a fivefold increase in the number taking the qualifying examination for entry as medical practitioners to the United States. In 1975 there were 1,000 candidates for that examination. That, by any measure, is bad enough, but in January of this year—and the examination takes place twice a year—2,500 doctors registered to take the examination. The indications are that for the year the number could be more than 5,000. By any standards the Government must accept that as being a serious position. These people are doctors and consultants the country can ill afford to lose.
Surely it cannot be in the interests of the National Health Service if the policy being pursued by the Government simply adds to the numbers of doctors leaving both this country and the National Health Service itself. The figures I have given are an indication of what is taking place today. Emigration is increasing, and, in my view, it will increase further so long as the Government pursue this irrelevant policy on which they seem to have set their heart.
There is one further immediate effect which the abolition of pay beds will have.

It is to deprive the National Health Service of the income that it receives from them. After the increased charges announced last month, I assume that no one will argue that their occupants are paying too little. The cost of a single room is now £37 a day in a London teaching hospital and £26 a day outside. The Secretary of State is throwing away that income by her policy of abolition.
The right hon. Lady will also have to make up the salaries of those consultants who are deprived of their private practice. At the last election we estimated that this would cost £30 million a year. Since then there has been an increase in charges for pay beds and increased pay for the consultants. Nevertheless, let us stick to that figure of £30 million. It used to be argued by the Minister of State that £30 million in the context of the health service and public expenditure was a matter of supreme irrelevance. I assume that that is not the argument today, for, if it is so supremely irrelevant, why did the Chancellor make so much of cancelling that mid-term census which cost less than £30 million and of the necessity for which the Minister of State assured us only a week or two before the Budget?
Why did the Government resist at every stage our suggestions that the national insurance contributions for the self-employed should be reduced—a reduction that would have cost only £21 million? We were told from the Government Benches that this was too expensive. The Government cannot have it both ways. If they continue with their plans let them explain how, at a time when everyone agree that the National Health Service is short of resources, it makes sense to throw away this income. Above all, let them explain how it is to the benefit of the National Health Service.
Perhaps let them explain one other thing. Much of the equipment, I think the Minister of State would agree, in the hospital service, and, indeed, some of the buildings, has been given by voluntary contribution of private patients in recognition of their treatment. Most hospitals have benefited from this. I shall give just one example which may have escaped the notice of Mr. Jamie Morris and his friends. As much as 75 per cent. of the equipment in the radiotherapy unit at Westminster Hospital has been donated by private patients who have been treated


there. That equipment is used not only by private patients but also by National Health Service patients. The assumption must be that contributions such as those will be lost when pay beds are abolished.
Perhaps we are making a mistake in believing that this policy has any kind of relevance to the health service at all. Perhaps the true explanation is that it is a good old-fashioned Socialist attack against the rich in this country. Again, that is an argument that does not bear examination. The vast majority of people who use pay beds are those who are insured under medical insurance schemes, notably under BUPA. This scheme covers around 2½ million people, and I imagine that even Transport House does not define the rich quite as widely as that. Therefore, on what basis exactly is the Labour Party acting? I imagine that the Labour Party conference believes that its Government are acting to stamp out the privilege that money can buy.
Let that conference not think for one moment that the Government are eliminating the paying principle from National Health Service hospitals. There are about 3,600 amenity beds in England. This little-known facility enables patients to buy privacy, currently at the rate of £1 or £2 a night. Already that is a price outside the reach of many people in this country, and presumably, as inflation continues, that price will have to increase to £4 or £5 a night.
Although I do not agree, I can understand the argument of those who say that no one should have the right to pay for special treatment. It would be logical for those who take that view to argue for the abolition of pay beds and, of course, amenity beds, because the same principle is involved. However, this is not the position taken by the Government, not unless they have changed their policy fundamentally since February, when a resident in Newbury received a letter written on the notepaper of the Secretary of State for Social Services. The letter was signed by Mr. Jack Straw, who was once president of the National Union of Students and is now the Secretary of State's special adviser. In this letter Mr. Straw argued that treatment inside the National Health Service should in no way be related to the ability to pay. He went on to say:

There is a system within the NHS of `amenity beds' by which for a small extra payment (£1 or £2 a day) a NHS patient who is being treated in the normal way may be accommodated in a single room or small ward for those who want privacy, not required on medical grounds. The Government is a firm believer in extending these facilities for privacy for those who want it.
The only special thing about that advice is its quite exceptional absurdity. On the one hand the Government are saying that they refuse to see people paying for private beds inside the National Health Service, and on the other hand, that they intend to expand the opportunities for people to pay for amenity beds inside the National Health Service. They abolish the pay beds, which make a real contribution to the finances and income of the National Health Service, and they expand paid-for amenity beds which are subsidised, presumably, by the general taxpayer.
The plain fact is that the Government are getting into the most enormous tangle on this subject. That is evident in the whole of the Government's approach to this subject. The right hon. Lady says that she wants to see separation of facilities. In other words, she is forcing into existence an alternative service. As Nye Bevan went down as the Father of the National Health Service, the right hon. Lady apparently wants to go down as the mother of the private health service. I am bound to say that that is an odd ambition for a Labour politician, but I assume that she knows what she is doing.
Already there are rumblings from the health service unions about this very point. They say that the number of private beds outside the health service should be limited. Presumably, they mean by some kind of ministerial decree. I hope that when the right hon. Lady replies she will make it clear that she has no intention of following up that particular demand.
In this debate we are arguing that the policy being pursued by the Government is harmful. I imagine that even some hon. Gentlemen opposite—if there are any hon. Gentlemen opposite—would thing it pretty irrelevant at this time.

Mr. William Hamilton: It is the quality that counts.

Mr. Fowler: As the hon. Gentleman says, it is the quality that counts.
Why is the Secretary of State acting in this way? It is true that she has come under pressure from some members of NUPE and that she has an ultimatum from COHSE to announce her plans before Thursday or else they will take action of their own. I imagine that she is not seeking to respond to that.
It is right that I should challenge one of the right hon. Lady's most frequent responses when she seeks to draw a comparison between the kind of action taken by NUPE members at hospitals such as Westminster and Charing Cross and the action taken by the consultants. In my view that comparison is entirely phoney. I am not supporting the continuation of the consultants' action.
As an Opposition we pressed the right hon. Lady to get back into talks. Eventually she took that advice, and we welcomed not only the resumption of the talks but also the discontinuation of the action by the British Medical Association. I made this clear in a statement, and I made the position clear to the HCSA. Let us have no more of that particular nonsense from the right hon. Lady.
However, what is so phoney about the right hon. Lady's comparison is this. Whether we agree or not, the consultants have taken action over the terms of their contract of employment and payment for it. Essentially, this is not what NUPE or COHSE are doing. They are making a clear attempt to dictate policy to the Government. They are attempting to take over a role which is not theirs. Their action is not industrial action, but political action.
Even those who believe that pay beds should go may, nevertheless, deplore the actions we have seen in this country over the past few months. Most people in this country regard the methods which have been used in those hospitals as completely odious, and the general tactics as dangerous in a democracy. I deplore the fact that the Government's action will be seen by those groups as a victory for those tactics.
Even at this point, however, I hope that the Government will make one point very clear: that just as the compromise of allowing pay beds in National Health Service hospitals was a compromise which was decided on by Parliament. so, too,

will any proposals of the present Government to abolish them also be decided by Parliament. This is a subject for legislation. It is not a subject for regulation.
The policy of abolishing the pay beds has little public support and is opposed by the overwhelming majority of medical opinion in this country. It threatens to increase the disillusion which many doctors already feel, and it throws away resources at a time when the National Health Service needs every penny it can get. It destroys a compromise that has worked well, and it brings no benefit to the National Health Service. It is a policy which we shall oppose at every stage.

7.21 p.m.

The Secretary of State for Social Services (Mrs. Barbara Castle): The eagerness with which the Opposition have precipitated this debate shows that they have a very great desire to bring this question to a climax. The hon. Member for Sutton Coldfield (Mr. Fowler) really does not have to read the newspapers or reports from NUPE or anyone else in order to learn the Government's intentions, because they have been stated quite clearly in two election manifestos, and they were repeated by me in the debate on the Queen's Speech last November.
The Opposition must surely be aware that this has been one of the matters discussed or due to be discussed in the Owen Working Party ever since it was set up shortly after we came into office. In fact, a departmental paper was circulated, published and discussed. Unfortunately, as the House knows, the work of that particular sub-committee on private beds got caught up in the breach with the consultants over the new contract discussions. Happily, that breach has now been healed and discussions on modifications of the new contract in time for next year's review will be starting shortly in the joint negotiating committee.
The Opposition, however, are clearly very impatient to hear a more precise statement of the Government's intentions on pay beds without any more delay, and I think that the medical profession wants this also. Therefore, I shall give the House as much precise information as it is possible for me to give at this stage before detailed consultations have begun.
As I have said, the Government have never hidden their intention to separate pay beds from National Health Service hospitals. It has been part of our Socialist policy for years. I must say that I find it a very strange accusation that we insist on carrying out our own policy. What is behind our policy? Why has the Labour Party very deeply adopted this policy of separation? The reason is that the whole ethic of the National Health Service is inspired by the principle that health care should be available to all, free at the point of use, and that access to treatment should be on the basis of medical priority alone and not ability to pay. That has infused our health service from the word "go". To us that is the most precious principle of all, one of the hallmarks of a really civilised society. Any hon. Members who have been to any other countries which have not got this particular kind of centrally organised and financed health service inspired by that ethic will know that it really carries our colours as a country throughout the world and in the thinking of people in other advanced countries who are not so fortunate.
I was really rather alarmed that the spokesman for the Opposition on this matter should have revealed himself as so ignorant about the question of amenity beds. He said "Oh, the people across there still believe in privilege. Amenity beds," he said referring to Mr. Straw's letter, "are about access to medical treatment." He then went on to describe the amenity bed, reading from Mr. Straw's letter, as one in which a patient was treated in the normal way but who could be accommodated in a single room—if one were not to be automatically available on medical grounds, as it is anyway to many people—for a small payment in order to meet the desire for privacy. But of course, that has nothing whatsoever to do with the question of queue jumping.
I want to tell the House very seriously that the knowledge that patients pay a private consultation fee to a consultant in order to go to the top of the queue really embitters all sorts of people, and not least the staff in the National Health Service. We on the Government side of the House believe it is an outrage that a patient should go into a private bed in a hospital as a result of crossing a consul-

tant's palm with money and then get the extra facilities there, for which the only person who gets any financial benefit is the consultant himself.
I repeat what I and my hon. Friend the Minister of State have said time and again in these debates. I believe that no Government would be able to leave that situation unchanged, because it is outwith the whole concept of fairness and equality of treatment which inspires modern society today and which is so typified by the National Health Service. I say to the House very advisedly that the whole fabric of the National Health Service would rot away if the principle of treatment on the basis of medical priority only were ever to be seriously undermined.
The hon. Member for Sutton Coldfield then got himself into a rare old tangle. I could not make out whether he was trying to say how important this private element was in the National Health Service to reward consultants properly and stop them from emigrating, or whether it was so insignificant that I ought not to bother with it. He called it a "tiny target". He is right. It is a tiny element, relatively. But that cuts both ways.
What I am faced with is the insignificance of the role of private beds in the total health care of the people of this country. Yet it has a consequence on confidence in the National Health Service among the staff and a consequence in opportunities for abuse quite out of proportion to the amount of medical care delivered to the number of people involved. The fact is that the overwhelming majority of people in this country depend exclusively for their health care on the National Health Service, and this must be our main concern.
Of the 403,500 beds in National Health Service hospitals, as the hon. Gentleman said, only 1 per cent., or 4,500, are private beds. This number has barely been affected by the industrial action of which he tried to make so much. Our estimate is that about 200 private beds have been closed by industrial action—two-thirds of them, I gather, in the Merseyside Region. Therefore, the hon. Gentleman cannot make a great thing out of that.
However, the truth is that even most of the people who subscribe to private medical insurance schemes for the peripheral advantages they bring, such as


being able to jump the queue for cold surgery, when the chips are down and they are faced with a serious emergency of life or death in their lives, turn to the National Health Service, and that is the vital underpinning of everyone's health care in our society. [Interruption.] Why should they not do so? Equally, why should they have a right, on the one hand, to undermine the morale and ethic of the NHS and yet admit, by their own actions, that the NHS is the important source of health care in this country?
If private beds are vital for health care, why are they so unevenly spread'? Taking the January 1973 figures, which are the latest I have, in Scotland, out of a total of 63.000 NHS beds, there were 370 pay beds. Of these, 139 were occupied, or a quarter of 1 per cent. of NHS beds. In Wales the figures were even more revealing. Out of 25,500 beds, a mere 68 were pay beds, and only 32 of those were occupied. That is 32 out of 25,500 or 0·15 per cent. No wonder the Secretaries of State for Scotland and Wales are associated with what I shall say tonight.
In England, there is a great disparity between regions in the use of pay beds. Occupied pay beds as a percentage of all occupied beds vary from 1·5 per cent. in north-west London to 0·3 per cent. in Newcastle. The average over the whole of England is 0·7 per cent.
The real give away is in the distribution of pay beds between different kinds of hospitals. Of authorised pay beds, 80 per cent. are in acute or mainly acute hospitals. On the other hand, there is a grand total of one pay bed in the mentally handicapped sector out of 50,796. So 80 per cent. of all pay beds are in the acute hospitals which account for only 35 per cent. of all hospital beds in England.
The reason is that for all but peripheral matters like non-urgent operations the people of this country overwhelmingly rely on the National Health Service for major urgent operations, for long-stay care, such as mental handicap, and even such basic needs as maternity. They do so because they know that they cannot get better treatment outside the National Health Service.
Therefore, the primary aim of health policy should be to strengthen that service, which is the life and death matter for the overwhelming majority of our people. It is against that background that I am now able to tell the House how we propose to proceed with the development of our policy and to separate pay beds from National Health Service hospitals.

Mr. Paul Dean: As usual, the right hon. Lady has indulged in a tirade against those who pay for health services, the doctors who provide those services, and what they take out of the National Health Service. Before she moves on, to complete the picture will she now tell the House how much the National Health Service obtains in revenue from health service patients, how much it gets for research. equipment, and other scarce facilities which would not he available were there not the links between private practice and the health service?

Mrs. Castle: We all know of the hon. Gentleman's concern for private insurance, but I think that I should be allowed to explain and unfold the policy before being interrupted with questions which, the hon. Gentleman will find I shall deal with as part of the statement that I am about to make.
Our policy is designed to end the unfairness of queue jumping within the NHS and to release more facilities and services, particularly of staff, for the benefit of NHS patients. To this end, and in the light of representations which have been made to me by the medical profession and others—indeed, by hon. Gentlemen here tonight—the Government have decided that the programme of phasing out should be effected by legislation as soon as parliamentary time is available. I am entering into immediate consultations with all concerned about the details of the programme.
My right hon. Friend the Secretary of State for Scotland and my right hon. and learned Friend the Secretary of State for Wales are associated with this statement. The policy which I announce today will apply to Great Britain as a whole, as I have said, although pay beds already form only a tiny proportion of hospital beds in Scotland and Wales.
In the meantime, I have observed that at present, on average, only 52 per cent. of pay beds in NHS hospitals in England are occupied by paying patients at any one time compared with 81 per cent. for all NHS hospital beds and an even lower percentage in Wales. Separately from the programme of phasing out I am, therefore, proposing to reduce the authorisations of pay beds in areas where these are under-utilised as was done by my predecessor, Kenneth Robinson, in 1967; and I am, therefore, putting this in hand at once. I expect the exercise to result in a reduction in England of about 10 per cent. in the total number of authorised pay beds as a start. I shall be watching the position to see whether further reductions are necessary. There is also continuing concern about the fact that some patients are admitted to pay beds with less delay than NHS patients with similar medical conditions. I will also approach the medical profession yet again to urge it to introduce common waiting list procedures both for its paying and non-paying patients.
Britain has a justifiable reputation as an international centre for specialised medical treatment. The Government are anxious that this reputation should be sustained. Many of the overseas patients coming into Britain specially for medical treatment already go to the wholly private sector outside the National Health Service, but some, wanting specialised services involving new techniques, go to NHS hospitals, particularly to specialist academic units in our teaching hospitals. We would wish to see NHS hospitals continuing to treat overseas patients needing specialised skills provided there is no queue jumping by them, that they are admitted as NHS and not private patients and that any fees they pay go to the hospital service and not to the consultants. My right hon. Friends and I already have power to charge aliens who receive treatment as NHS patients, and we would intend to review the level of charges to take account of the new situation.
The private sector at present relies heavily on the NHS for certain facilities, including blood, radiography and laboratory testing. We are reviewing what facilities, if any, should continue to be made available to the private sector. We would, of course, ensure that realistic charges would be made for any services

provided. We would not, however, propose to make any charge for blood, other than the cost of services such as cross-matching.
One reason, as we all know, why individuals sometimes "go private" is that they wish for greater privacy than they think is available in the NHS. In fact, as the hon. Member for Sutton Coldfield said, Aneurin Bevan himself established a system of amenity beds under which, for a small fee, a patient receiving non-fee-paying NHS treatment could have a single or double room for extra privacy, where this room was not required on medical grounds for him or another patient. Contrary to the confused views of the hon. Gentleman, we have every intention of maintaining this system, and, indeed, of building on it. To date, this amenity bed facility has not been well used, partly at least, because it has been given so little publicity. We intend to rectify this situation. I shall also be discussing with all the staff how we might extend the use of amenity beds. The separation of pay beds will, of course, make more single rooms available for use by NHS patients generally. The Government are committed to providing every patient with the maximum privacy possible, as will be apparent from our designs for new hospitals.

Mr. Peter Viggers: Does the right hon. Lady accept that amenity beds are not very well known about? What she is proposing to do is to abolish decent capitalist beds honestly paid for by people who wish to have a choice of private beds and to expand the use of amenity beds which are allocated by those in responsibility. These are commissars' beds.

Mrs. Castle: That is an unworthy comment. The hon. Gentleman calls amenity beds commissar beds. He should make it known to his constituents what many of them do not know; namely, that any patient in the NHS within the facilities available in a hospital can ask for an amenity bed, and numbers of them do. A payment of £1 to £2 a day is a modest sum if people want to pay for their privacy.
I am interested in this sudden reaction of Conservative Members against amenity beds. They do not like amenity beds because they take away the alibi that


what the private patient is paying for is privacy. If there are amenity beds, privacy can be had for a modest sum without jumping a queue. It becomes startlingly revealed that the support of Conservative Members for private practice is based on the fact that the fee is paid to jump the queue, and for nothing else. That is why they do not like the idea of amenity beds.

Mr. Norman Fowler: What we are objecting to is not the right hon. Lady's plans on amenity beds. We are drawing attention to the total inconsistency of what she is saying. At one stage the right hon. Lady is rejecting the paying principle of pay beds but now she is extending the paying principle with amenity beds.
Will the right hon. Lady now reply to the question asked by my hon. Friend the Member for Somerset, North (Mr. Dean) and say how much this policy will cost the British taxpayer?

Mrs. Castle: It is clear that I should not waste the time of the House by allowing such interruptions, because the hon. Gentleman keeps interrupting me in a way which prevents me from getting to the points which he is demanding should be answered. If he cannot see the real reason why the Conservative Party has suddenly been alerted to the danger to it of amenity beds. I am sure that the rest of the House can see it perfectly well.
As I was saying, as Secretary of State I am statutorily responsible in England for the nation's health and for the Quality of the care given to all patients whether they are treated within the National Health Service or the private sector. My right hon. Friends are similarly responsible in Scotland and Wales. I already have powers under the nursing homes legislation to license private nursing homes and to make regulations as to the conduct of such homes. But these powers are limited, and their adequacy must be reviewed, given the rôle which the wholly private sector may take on once the phasing out programme is completed.
The Government have, therefore, decided to consider the extension of my existing powers of licensing. This will enable me, as Secretary of State, and my

colleagues, the Secretaries of State for Scotland and Wales, to regulate more closely than is possible under our existing powers the operation, extent and development of the private sector. We may also need to guard against the possible development of undesirable commercial or advertising practices. It is right that those representing the interests of the private medical sector should be consulted at a formative stage and before the details of the licensing system are settled. I shall, therefore, be issuing invitations to consultation to those interested in the very near future.
I hope that these consultations can be conducted speedily, and I intend as soon as possible thereafter to publish details of the way in which, subject, of course, to parliamentary approval, the licensing system will operate. In the meantime, to ensure that the operation and development of the private sector proceeds in an orderly way, I should make it clear that we intend that the extension of the licensing system should cover all existing nursing homes as well as any new developments or changes of use. In the light of this I have made arrangements for officials of my Department to be available for discussions with those contemplating new developments or changes of use before the extensions to the system come into force. Within the broad framework of policy which I have today outlined we are anxious, as I have indicated, to consult fully with the medical profession and the other staff of the NHS about the most sensible way of carrying out this programme.
The Government recognise that the phasing out of pay beds from NHS hospitals will involve some loss of revenue. On the other hand, the NHS will benefit from the additional beds that will become available for NHS patients. It is difficult to put precise figures on either of these two factors. However, the Government have decided that the appropriate funds will be made available so that the revenue allocations of health authorities are not affected as a consequence of phasing out pay beds.

Mr. David Crouch: rose—

Mrs. Castle: No, I must get on. It there are any specific points which the


hon. Gentleman wishes to raise in his speech the Minister of State can deal with them later.

Dr. Gerard Vaughan: The right hon. Lady has made an important statement about licensing. Is she saying that she will limit by licensing any increase in the number of private beds available which could arise as a reaction to her changes within the National Health Service?

Mrs. Castle: I am saying that it is my duty to see that developments in the private sector do not operate to the detriment of the NHS. Therefore, it is necessary to review the powers which I now have and to consider their extent and scope. But I am not proposing any details tonight because it is right that all those interested should be consulted at the formative stage, and this I shall proceed to do very quickly in the context of this principle.

Mr. Paul Dean: rose—

Mrs. Castle: I am sorry, but I have already taken up too much time. I do not want to take up so much time that it is not possible for others to take part in the debate, and there have been a number of interruptions.
This, then, is our plan of action to fulfil the policies in which we believe and the election pledges which we have made. It is a plan to end the queue-jumping which has caused so much bitterness and frustration and to restore the basic ethic of the NHS. It will release facilities and services, not least of staff, for the benefit of NHS patients as a whole. It will enable us to widen the provision of privacy for those who need it or desire it and help to reduce waiting lists. I believe that one of the most potent reasons for the resort to private consultations, private insurance and private fee paying is the length of those waiting lists.
As I have said, I hope that consultants will agree to introduce common waiting lists for all their patients but I am also convinced that the lists could be reduced by better management by health authorities and by the injection of comparatively small sums of money at crucial points to break bottlenecks or increase key posts. My Department has been studying this

problem for some time together with the medical profession and I shall be issuing a circular of guidance to health authorities this month. I have also set aside £5 million this year out of our health expenditure total for allocation to health authorities to finance minor schemes and improvements which can reduce their waiting lists.
With this announcement of the Government's decision I hope we shall be able to make this separation of pay beds in an orderly way in the interests of all patients in our NHS hospitals.
Last July, in a statement on the dispute at. Charing Cross Hospital, I said:
My responsibility is to do everything in my power to ensure that ill patients, whether private or NHS, do not become the innocent victims of any action taken in industrial disputes.…I do not condone the action which is being taken. I deplore anything which could damage the health of patients or the interests of the NHS.
That has been my consistent position as Secretary of State in dealing with all industrial disputes which have arisen in the NHS—unlike hon. Members opposite, who have been only too quick to condemn action against pay beds, but whose silence to condemn the most serious and damaging industrial action against the NHS, by consultants, has been deafening. Today I have made clear, once again, that the decision on pay beds is one for this House, for Parliament, to take. I call on everyone in the service, however strong his feelings, to leave it to Parliament to legislate.
I do not expect the Conservative Party to greet that legislation with enthusiasm, although I note with pleasure that the Liberals, through their former spokesman on medical affairs, Dr. Winstanley, have come out robustly in favour of separating pay beds from the NHS. With their traditions in this field I would expect it of them. But Conservative Members are of a different ilk: they secretly believe in queue-jumping and have always blessed private insurance and, in fact. have openly encouraged it. I repeat to them what I have said many times: I am not abolishing private practice. What I am concerned with is the integrity of the NHS.
Conservative Members have always underestimated the moral power aid influence of a service in which people are


treated on grounds of medical need and not of ability to pay. I would advise them and those in the medical profession who oppose our policy—to study what is happening in the United States, as I have done recently. I was struck during that visit by the alarm which is mounting there at the escalating costs of their health care under their system of private medical insurance and by the envy and curiosity they feel about our NHS. In the United States it is not only the patients who suffer; it is the medical practitioners as well.
I was interested to read in Friday's Guardian that there, too, the doctors and consultants are now threatening to go on strike—not for pay: Heaven knows their fees are big enough—but because of one of the in-built and growing hazards of the private medical insurance system which dominates health care in the United States. The report said:
The first skirmish in what promises to be a nationwide showdown between physicians and surgeons and their insurance carriers started here today. The casualties are likely to be the patients. Last-minute efforts to resolve the crisis caused by staggering increases in the cost of medical malpractice insurance failed last night and many of the 4,000 doctors involved here refused to work today rather than pay the new rates. Citing losses from jury verdicts in malpractice lawsuits, the company, a financially troubled subsidiary of Teledyne Incorporated raised its rates for some doctors in Northern California by 400 per cent. to a maximum of nearly $10.000 a year for high-risk specialists.
When I discussed health care in the United States, I was asked, "What do you do about the malpractice problem in your NHS?" They were staggered when I replied "It barely exists." I say advisedly that it barely exists here because people still believe in the ethic of the NHS. Health is not bought and sold here like a market commodity as it is in the United States. Patients do not sue the doctors and consultants: they write me letters of thanks and praise for the selfless care they have had under our free NHS.
This spirit is one of our most precious national assets. It is because the Opposition, with their passion for private beds, would damage it that I ask the House to reject their motion tonight.

7.55 p.m.

Mr. Mark Carlisle: The Secretary of State seemed almost to take

objection to the fact that we are debating this matter. She took the view that it had been in the manifesto twice and that she had made her views clear, and therefore we were wasting our time. I believe, however, that the policy of the Labour Government in phasing out private beds from the National Health Service is a classic example of all that is craziest and all that is worst in the Socialist philosophy of this Government. It is right that Parliament should have an opportunity to express its view upon the matter.
It is now clear from the right hon. Lady's important speech, particularly what she said about the extension of her licensing powers, that the fear of many people that the attack on pay beds in the NHS hospitals was merely the thin end of the wedge in the attack against private hospital treatment in general was justified.
I said that 1 believed that the decision was both crazy and wrong. It is crazy because at this time of crisis in the NHS the effect will be to deny the service one of its existing sources of revenue. It is wrong because it is based on the Socialist philosophy that everyone should look to the State purely and wholly for his own dependence and should be actively discouraged from doing anything to provide for himself. This is done in support of what would appear to be a guiding principle of the present Government—that so long as there is anyone who cannot afford to provide anything for himself, no one should be permitted to do so lest by his own efforts, by his own exertions, indeed by his own choice as to how to spend his money, he may attain some advantage over other people. This decision is indeed economically crazy. I was not surprised that the Secretary of State, although pressed from this side, was coy about the cost of this decision. We know that the health service is short of money and that there are about 4,500 pay beds in NHS hospitals. We know that people who choose to go into such beds as a result of insuring themselves pay today anything up to £37 a day for the privilege. It cannot be disputed that the average cost of a pay bed in a National Health Service hospital under the charges which came into effect on 1st April must now be slightly more than £200 a week. It does not take a great mathematician to


realise that, even accepting the general figure of 60 per cent. occupancy, as a result of the removal of these beds the NHS stands to lose at least £30 million a year.
I am not surprised that the Secretary of State was unwilling to advance a figure. That £30 million which is paid willingly today by the individual is now to be recovered from the already hard-pressed taxpayer. That is indeed absurd. It is stupid at any time, but at this time it is economic madness.
I should like to know the views of the Chancellor of the Exchequer, who is calling for a greater cutback in public expenditure while the right hon. Lady is abandoning £30 million that is now being contributed by private patients and will have to come from the taxpayers. This decision will denude the NHS of money that is now willingly provided, and instead the State will have to cope with the vast majority of patients. The decision totally ignores the fact that many people are still willingly prepared to pay more to provide for themselves than they are prepared to see compulsorily deducted from their incomes by way of taxation.
The right hon. Lady said—it was at this point that I wished to intervene—that the justification was that there was only 52 per cent. occupancy of pay beds against 85 per cent. occupancy of health service beds. I hope that the Minister of State will tell the House whether that is comparing like with like or whether the 85 per cent. figure includes geriatric and long-stay beds in the health service, because those make up about 50 per cent. of health service beds. What is the rate of occupancy in health service beds compared with pay beds in comparable hospitals?
However, it is the principle with which I am concerned. I cannot understand what is said to be wrong in principle with people being willing to provide against their own illness or their own ill health having paid their taxes and their national insurance contributions. Despite the right hon. Lady's speech, I cannot see what is objectionable in their choosing to pay more of their own money to provide for themselves. It is not, as Government spokesmen often suggest it is, anti-social; it is merely anti-Socialist, and that is why the right hon. Lady objects to it so much.
If people wish to insure in this way to enable them to have the specialists of their choice and to have the advantage of the privacy of a private room, and to enable them, I accept, to extend that choice into the time of entering hospital in non-urgent cases, why on earth should they not be allowed to do so? We are, I hope, still democratic enough for people to be able to choose to spend their money as they like.
The right hon. Lady mentioned people coming from overseas to enter health service hospitals as private paying patients. If I understand her aright, she is now proposing that they should still come, provided that they do so as health service patients paid for by the British taxpayer. They cannot themselves pay for an operation.

Mrs. Castle: indicated dissent.

Mr. Carlisle: The right hon. Lady shakes her head. That was what I understood from her speech. As, understandably, she was not prepared to give way, perhaps we shall have clarification later about those who come from overseas as private patients.
If people choose—and here I must declare an interest as I myself choose—to insure themselves against their own ill health in the way they wish, they should be actively encouraged to do so and not derided for taking that decision. The right hon. Lady's attitude as it came through in her speech is symptomatic of what is wrong with our society. Her approach is based on the philosophy that the State should provide for everyone rather than that people should be encouraged to provide for themselves.
No one questions the need for the health service or suggests that we are not proud of having a fine health service in this country. That is not the issue in this debate. No one doubts the right of every person in this country to have the best possible medical treatment when he needs it. What is in question is whether people should have the right to choose to provide additionally for themselves. By refusing that right the Government ignore a basic human attribute that motivates many people, namely, the desire to work so as to be able to provide for oneself and one's family. At a time when incomes are rapidly rising, we should be actively


encouraging more people to insure themselves in this way rather than decrying the idea, which is the effect of the Government's policy.
The right hon. Lady must know that we have had two recent examples of leading members of the Government unfortunately having to go into hospital. On both occasions we have been assured with great pride and blowing of trumpets that the Ministers were going in as ordinary health service patients paid for by the State. In their case it should not be matter of pride; rather it is a matter of shame. With incomes in excess of £15,000 a year they should be able and responsible enough to provide through insurance for their own hospitalisation rather than expect the cost to be carried by taxpayers.
I question the view that everyone, whatever his position, should go into a health service bed at the expense of the taxpayer when many people are willing, having paid their taxes, to meet their own expenses. We should encourage more and more to do so. Tonight we should be discussing not phasing out pay beds, but the means by which to encourage more people to provide for themselves and so provide greater resources for the hospital services.
The right hon. Lady's announcement is wholly against the interests of the taxpayer and the medical profession. It is wholly against the interests of the patient and the health service as a whole. The service is looking for new sources of revenue, but it is to be denied the £30 million a year that now goes willingly into the hospitals. For those reasons, I very much hope that my hon. Friends will carry the motion to a Division.

8.8 p.m.

Mr. William Hamilton: The hon. and learned Member for Run-corn (Mr. Carlisle) is liberal in many respects, but that speech was about the most reactionary that I have heard on the subject of the National Health Service in 20 years in the House. I do not know whether it is the new Toryism under the right hon. Lady the Member for Finchley (Mrs. Thatcher), or the old Toryism peeping out again. I suspect that it is the latter. Some of us still remember that the Tory Party voted against the

health service in principle, and I still suspect that many Tories want to get rid of it. By extending rather than reducing the principle of pay beds, they undermine the service.
The hon. and learned Gentleman talked like a market huckster—people were only buying operations for themselves and if they could not foot the bill they could not have the operation. He suggested that people should have the right to buy better, presumably, facilities than those available under the health service.

Mr. Carlisle: The hon. Member and I have debated many issues on other occasions and I have always found him very fair. He knows that he has completely misquoted all that I said. I said that the best possible health service should be available to everyone, and no one should attack me on that. I said that we should also actively encourage those who were willing out of their own money to provide for themselves. That in no way contradicts my view of the importance of the health service.

Mr. Hamilton: My right hon. Friend has said more or less the same thing. She has not said that she is abolishing private practice. She has said that if there is to be private practice the whole lot should be outside the National Health Service. I have made the point in earlier debates that if there is one thing the Opposition have evaded debating it is the all-party report of the Expenditure Committee dealing with private practice in the health service. Virtually all the evidence shows gross abuse practised by the consultants within the health service. But the Tory Members of the all-party committee used their majority in the face of all the evidence to produce a brain-washing report saying that private practice was of benefit to the health service.
That was despite evidence of consultants stealing valuable equipment from the health service, taking it outside and using it in their private clinics in Harley Street and charging their patients as if it was their own equipment. Tory Members say "It's just a little vice". That is the special plea of the barmaid who had the bastard baby—"It's just a little one". But it deeply offends the people we represent. That is why my right hon. Friend was right to remind Conservative Members that in the first instance we fought for


the health service because we regard health as being the equivalent in the civil area of defence in the military sphere. The burden ought to be shared by everyone in the community. No one ought to be able to contract out.
There is one private army in the north of Scotland. I believe that the Duke of Atholl has the only private army. It is relatively harmless. We say that the British people as a whole should pay for their defence collectively and that the same applies to health. A private army is illegal in this country. My right hon. Friend should consider making a private health service illegal. I would go further than that. I would say that there should he no right to exercise the power of the purse and to take away scarce resources. That is what is happening. Wealthy people are using such resources as a privilege.
There are some services which are collective services and ought to be paid for collectively. People ought not to be able to contract out of them any more than any one of us can contract out of the fire service, defence and many others. The initiator of the health service, Nye Bevan, made that clear. The compromise we are talking about was part of the price he had to pay to eliminate the opposition of the medical profession to the whole principle enunciated by my right hon. Friend.

Mrs. Jill Knight: Will the hon. Member bear in mind two points? The first is that these people who use private practice have already paid their full share through rates and taxes to the National Health Service. Secondly, he keeps talking about wealthy people with long purses. Will he remember that the average person paying into BUPA is getting £2,500 a year? That is not the wage of a wealthy person today.

Mr. Hamilton: They are buying privilege, buying a place in the queue to which they are not medically entitled.

Mrs. Elaine Kellett-Bowman: The hon. Gentleman says that these people are using their privileged position to buy time and a place in the queue. If there were a common waiting list that argument would no longer apply. Why. in that event, would the hon. Gentleman be against these people using

their money in this way if they have also paid their taxes?

Mr. Hamilton: If the common waiting list came there would be no need. I would guess that we should see a great reduction in the number of people who would want private treatment. Moreover, these people get tax concessions on their payments to BUPA so that they do not pay twice. I am glad to see that that is being ended in the Finance Bill. Often people's firms pay the subscriptions. It is a fringe benefit to buy privilege. If such people want a second health service financed in that way, let them have it. Let them provide their own buildings, equipment and everything else. But they should not abuse the health service and then speak about freedom of choice.
The hon. and learned Member for Runcorn said that these were the craziest and worst aspects of Socialist philosophy. It is Socialist philosophy certainly. That is what we were sent here to put into effect, and we shall do so—the quicker the better. [Interruption.] There is no prospect of Tory Members coming into power in the foreseeable future.
The hon. and learned Member went on to define what he meant in talking about these "crazy" aspects. He mentioned the loss of revenue of £30 million. Tory Members have a wonderful facility for reducing all argument to terms of cash. There are more important considerations. My right hon. Friend admitted that there might be a loss of cash. I do not know what the compensating advantage is in terms of beds released for NHS patients but there will be some. There is a feeling building up, deliberately instigated by right hon. and hon. Members opposite, that there is developing a two-tier health service—a service for those who can buy privilege and another for those who cannot and have to wait months, sometimes years, for surgery of one kind or another.

Mr. Crouch: Is the hon. Member aware that there are many of us on the Tory benches who are concerned that the Secretary of State's action today will cause the creation of a very much bigger private service outside the National Health Service, attracting to it not only 2½million insured people and a lot of money but also a lot of people working in the health service, thus weakening it?

Mr. Hamilton: I do not think that worries very many of my hon. Friends. I think that is what Tory Members want. They have always believed in that. Their speeches are based on the principle that if someone has money he should be able to buy privilege whether in the market place, the hospital or anywhere else. We on this side flatly reject that philosophy. The National Health Service would crash if it were based on that principle. We are determined that it shall not crash.
The health service is already in considerable difficulties and, if inflation continues at the present rate, it will get into worse difficulties. That makes it all the more important that people who can afford to contract out should be denied the opportunity to obtain privilege.
If we were to encourage any step that the Government might take to expedite the creation of a private health service, which is what one hon. Gentleman has said he fears will happen, the British people would revolt, because, despite its shortcomings, our health service is still the best in the world. We must find the resources for it.
I do not want to become involved in a broader debate on the economic situation. Unless and until we get the national economy right, the National Health Service and the sane principles underlying it will be undermined. I should be the last to want to see that. I do not believe that anything that my right hon. Friend is doing or has proposed today will further that undesirable aim. On the contrary, I believe that her actions will encourage many people working in the health service. I declare an interest. I am a sponsored member of the Confederation of Health Service Employees. That union and the National Union of Public Employees did not dictate this policy to the Government. The Government had this policy, anyway. Those unions approve of it. The workers in the health service want to see fair play, and the abolition of pay beds is just one step in that direction.

8.22 p.m.

Mr. David Penhaligon: This is the second debate on this subject that I have attended since becoming a Member of Parliament. At least this debate is specifically about the subject of pay beds. The last debate was supposedly about the

National Health Service but we spoke about pay beds for the whole debate.
We have been given the precise figure of 4,500 pay beds in National Health Service hospitals. That works out at about seven pay beds per parliamentary constituency. We have also been told that there are 68 pay beds in Wales—two for each parliamentary constituency —and 139 in Scotland.
Do the Opposition really believe that the abolition of this minuscule number of beds can cause all the damage that the motion claims, namely, that it will
be against the interests of the Health Service, the patients and the medical profession"?
The speeches we have heard have sought to suggest that there will be far more serious consequences than the motion suggests and that the mere removal of seven pay beds per parliamentary constituency will bring about the total collapse of the Health Service within a few days.
If the Opposition argue that seven pay beds per parliamentary constituency prop up the entire Health Service, why not have 14? With 14 pay beds per constituency, many of the things that worry me about the Health Service could be overcome at a stroke. I therefore wonder—I have argued this point many times with Conservative Members—just how much enthusiasm they have for the National Health Service.
The matter has been presented with some vigour today. The great argument is about queue jumping. This does or does not exist. "Of course it does not exist", say Conservative Members. Of course it does, as anybody who has ever been anywhere near a hospital knows. We all know that it happens, particularly for what are jokingly called non-essential operations. An operation for a hip that hurts a great deal is very much a non-essential operation, but we know that the way to get such an operation performed quickly is by paying the necessary £400 or £500.
It is said that people must be able to have privacy. I go along with the argument as to privacy. For many people the intimate discussion that takes place in some medical wards with one patient insisting on telling other patients all his problems is all too much. Some people are prepared to afford the relatively small


sum involved to escape from that embarrassment. Why should they not do so? Therefore, the amenity beds are greatly appreciated.
I become frustrated by the amount of time we spend discussing this subject inside and outside the House. The real problem facing the National Health Service is not queue jumping. It is the length of the queues. Perhaps we should be spending this time today discussing the important problem of how to reduce the length of the queues.
I know that nothing like 600 Members are present, but I have calculated that this debate represents 1,800 man-hours, or nearly half an hour for every pay bed. We are giving this subject more attention than it deserves.
I ask both sides of the House to try to drop some of the dogmas. We should ask ourselves which way we want the service to go, and we should try to answer some basic questions. I have always believed in a really free National Health Service. It is noticeable that at one time or another the vast majority of Members have voted for prescription charges, which I have always regarded as a retrograde step.
I will pose some important questions. Why is the amount we spend on health as a percentage of the gross national product the lowest for any of the industrialised nations? Why is Britain dropping down the league tables of life expectancy and infant mortality?
What about geriatric accommodation? There are not many pay beds in geriatric accommodation. There is a town of about 15,000 people in my constituency where the nearest geriatric bed is 15 miles away. Those who know anything about rural transport know that 15 miles in a county like Cornwall can be a very long distance for anyone of advanced years. With accommodation that far away, it, perhaps, involves separating a couple for the first time for 10, 20, 30 or 40 years. The result is often that we mend one and that by the time that one is returned to his home the other has unfortunately fallen ill. That is a subject to which it is worth devoting the time that we are devoting to this subject.
Yesterday I read in the local newspaper of the Minister of State that one of his local hospitals has announced that it will

recruit no more nurses because it does not have the money to pay them. In Plymouth, therefore, there is a waiting list with a difference: it is a waiting list of qualified nurses who wish to have a job in a hospital in the hon. Gentleman's constituency. That is a subject on which it is worth spending this amount of time.
It is most important that the House should discuss what we are to do about the effects of technology on national health. The more I look into the subject the more I realise that we are by our own skills evolving technologies which we cannot afford to give to all the people in this country. That is something that precious few people will admit in public, but we all know it to be true.
Perhaps some of the criteria that exist in the National Health Service for deciding who does have treatment and who does not should be discussed on the Floor of the House. That would be worth 1,800 parliamentary man hours, whereas this motion is not. I do not promise that we shall necessarily support the licensing regulations when they are given to us in greater detail, because we shall want some time to consider them. However, the Liberal Party will oppose the motion.

8.30 p.m.

Mr. Peter Hardy: Labour Members note with interest the comments of the hon. Member for Truro (Mr. Penhaligon) and believe that his party is right to take a view, similar to them, that the whole question of privilege within the National Health Service should be reconsidered.
I came to listen to the debate, and I had little intention of participating until I heard a rather vicious attack from the hon. Member for Sutton Coldfield (Mr. Fowler) about the trade unions representing employees in the hospital service. I must declare an interest as a sponsored Member of the National Union of Public Employees.
The hon. Member for Sutton Coldfield has allowed the more bitter comments of the more biased newspapers to create this impression rather than reality. The Rotherham hospital branch of the National Union of Public Employees wrote to me on this issue only a week or two ago expressing not a revolutionary view but a very moderate view, believing, as hospital workers throughout Britain


do, that people who purchase the right to occupy a pay bed in the National Health Service do so often because they feel it will allow them to jump the queue.
It is rather unbecoming of the Conservative Opposition not to make their position clear. Some of us believe that the Conservative Party has changed quite seriously in the past six or seven years. When one looks at the debate on the 1968 Act one sees that the Shadow spokesman for the Opposition speaking at the Opposition Dispatch Box made it clear that the Opposition at that time believed that:
It is extremely important that there should be no question of private patients jumping the queue for medical need ….—[Official Report. 7th December 1967; Vol. 755, c. 1700.]
In other words, there should be no question of queue-jumping. However, what we have heard today seems to suggest that that is perfectly acceptable to some, or perhaps all, of the Conservative Party.
Many of us believe that a great amount of extra resources needs to be devoted to the National Health Service. Many of us believe that the National Health Service should be improved and enhanced. One thing which will be required to attain that improvement is the confidence of the people, an overwhelming proportion of whom receive their care through the State service. If the people of this country are to have confidence in the National Health Service, it needs to be clearly demonstrated that privilege cannot be bought.
I want my hon. Friend to make very clear the position which has been expressed to me by a number of union members who are interested in this subject. The National Health Service Act 1946 made provision for the setting aside of pay beds. This legislation was quite markedly changed by the legislation in 1968. The effect of the 1968 legislation, as I see it, was to remove the designation of beds as exclusively pay beds for the use of private patients only, making it possible for the hospital authorities to use all beds in their hospitals for the National Health Service and to allocate beds as and when and where required for pay bed facilities. If that is the position, the present situation is unclear and possibly a contradiction of the law as it is at present.
My hon. Friend knows a great deal more about this than I do, and I hope that when he winds up the debate he will make clear what the situation is at present with regard to the implementation of the 1968 Act.
I believe that it is essential to demonstrate that the people of this country can have confidence in the National Health Service. If they feel that in order to obtain prompt service they have to pay—whether they can afford it or not—the service is brought into question.

Mr. Alan Clark: Every hon. Member who has spoken today has mentioned the dreadful business of jumping the queue as if it was a most deplorable and heinous offence. It could be said that one of the things that are most wrong with this country is that everybody is meekly prepared to line up in queues. If people wish to use the resources which they have accumulated through their own thrift and providence to jump ahead of those who for various reasons such as torpor or sluggishness are prepared to wait in a queue, why on earth can they not?

Mr. Hardy: The difference between the hon. Gentleman and myself seems to be so fundamental that it is scarcely worth comment. However, before becoming a Member of Parliament I was a teacher in a South Yorkshire mining area. I remember speaking to a parent, not in affluent circumstances, who was prepared to sacrifice, quite excessively in my view, because the family felt it necessary for the child to have a routine operation promptly and the alternative was to wait a long time. The family did without a holiday for two or three years. Hon. Members may feel that that illustrates strength of character. I think that it illustrates a situation which should not exist, because that degree of sacrifice should not be demanded in any civilised society, and it is a civilised society that we are seeking to serve.
The figures which have been given today are illuminating. There are very few pay beds in Scotland, Wales and certain areas of the North of England. That is relevant because it is in Wales, Scotland and the North of England and other older industrial areas that the situation is becoming less tolerable. The Conservative Party, unfortunately, is becoming


more and more concerned with the affluent areas of the South. It is not a British party any more. It is the party of the stockbroker belt and of the comfortable affluent suburbs, and it is the interests of those areas which it is seeking to preserve. [Interruption.] The hon. Member for Lancaster (Mrs. Kellett-Bowman) is a temporary custodian of the Lancaster constituency. By a fluke, she remains a Member, but I do not suppose it will be for much longer. One of my hon. Friends suggested that an alternative career as a football referee might be more appropriate.

Mr. Norman Fowler: If the hon. Member proposes to continue on this peculiar tack, may I ask him how he explains last week's results in the local elections in the North and the Midlands?

Mr. Hardy: It is unfortunate that the people of this country have very poor memories and cannot recall that the 1972 local government reform was carried out by the Conservative Party. Some of us will be remedying that omission in the next few weeks. Perhaps we assume too lightly that people's memories are longer than reality. But that is changing the subject, perhaps because the hon. Member for Sutton Coldfield does not want us to look at the reality of the situation.
In the North of England, Scotland and Wales the number of pay beds is declining. In the more affluent areas the numbers are high. That seems to me to present a dangerous situation, because we should be trying to reduce differences and inequalities between the regions. The present situation emphasises inequality and is intolerable. We should not emphasise regional differences. We should not try to "con" people into believing that they must pay for adequate and prompt treatment to satisfy their needs.
I hope that before we conclude this debate hon. Members opposite, on the back benches if not on the Front Bench, will make clear their attitude to the policy which my right hon. Friend the Secretary of State announced about common waiting lists. If the Conservative Party maintains the view which was expressed on its behalf in 1968—namely, that it spurned the idea of queue jumping—it is entitled to give a welcome to my right hon. Friend's pronouncement. The Opposition must come

clean on this matter. I believe that my right hon. Friend's policy is right and just, and that if the Conservative Party is interested in Britain as a whole it will offer a welcome to my right hon. Friend's statement.

8.40 p.m.

Mr. Hal Miller: I believe that we should be discussing the pursuit of excellence in the National Health Service, excellence in the care of the patients and excellence in the training of the profession. It is to my regret that we have already embarked upon a discussion overladen with ancient memories and a great deal of emotional antagonism that will serve only to cloud the argument. Only the hon. Member for Truro (Mr. Penhaligon), who is no longer in the Chamber—whenever the Liberals have made their contributions they depart—directed our attention towards the management of resources in the National Health Service. I think that on calm reflection all of us would agree that that is the real problem, and that the eradication of pay beds will not eradicate the waiting list in any shape or form.
I am afraid that a false prospectus is being offered to the people by the Government. The Government are pretending that they will bring about a radical improvement when, by the admission of the Secretary of State in the very figures she gave us, there is no possibility of that improvement coming about as a result of the action that she has announced to the House.
The right hon. Lady's statement has raised a fundamental political philosophical question—namely, whether a mixed economy is to continue in the National Health Service as allegedly it is the intention of the Government that it should continue in commercial and industrial life. The mixed economy, so to speak, has already been brought under attack in the educational sphere. We need to have that question answered clearly and without equivocation.
I press the Minister of State when he replies to elaborate a little more about the right hon. Lady's plans for the licensing of medicine in the private sector. If it is to be separated out—I must say at once that I should regret that step, because I can see it doing nothing but


ill and leading only to greater divisions in society apart from the question of allocation of resources—is the private sector in medicine to be limited, restricted and controlled with the aim of buttressing the public sector? I hope that the Minister of State will be able to enlighten us a little further in advance of the consultations which are so properly and recognisably necessary for the profession. However, I think that the principle needs to be made clear before the consultations take place. It is a principle that should be made clear on the Floor of the House.
I revert to my concern with the pursuit of excellence in the National Health Service and my belief that Aneurin Bevan was entirely correct to house private and public medicine within the NHS. Labour Members have already tried to make capital out of the fact that for serious emergency operations people customarily go to NHS hospitals. That is something of which we should be proud. It indicates a recognition of the fact that the reputation of the profession is made and retained largely in the NHS.
It is only when a reputation is established that patients are referred from other sources for treatment. I am sure that the Minister of State, being himself in the profession, is well aware of how a consultant's practice is established and developed. It is by the pursuit of excellence and by performance that consultants attract private patients both from this country and more particularly from overseas.
I hope that the Minister will explain a little more clearly the remarkable assertion made by the Secretary of State for Social Services that private patients from overseas would come to this country on a common waiting list as National Health Service patients but with private amenities and paying their fees to the NHS.
My contention is that, apart from any other consideration, patients from overseas come here in the hope of treatment from the consultant whom they believe to be uniquely able to offer them a way out of their afflictions. That is why they come—for treatment by that man rather than treatment in that hospital. I shall come later to the point relating to the consultant who has built up his

practice and who attracts to his hospital not only the clinical material, as f have heard it chillingly described—in other words, overseas patients with peculiar diseases—but also the staff who learn and improve their skills in the treatment of those illnesses. It is the team concept that is important. It is the attraction of other doctors from all over the world to the unit which builds on that discipline by teamwork and develops the machinery and techniques. That is what attracts people to a consultant.
In answer to a Question which I tabled in the House last week, the Secretary of State pretended to reply that it was adequate reward for such a man that his fees should be paid to the National Health Service. We know that in the Soviet system the rewards take the concrete form of villas or motor cars. In this country. Up to now, we have been accustomed to there being some tangible monetary form of reward. Are we to move to another system of reward, while not going quite as far as the suggestion of my hon. Friend the Member for Gosport (Mr. Viggers), who suggested the possibility of a commissar system? My hon. Friend was right to point out that once we depart from some form of monetary reward, we shall move towards a more nebulous, less clear and less overt reward —a reward which up to now people in this country have found entirely objectionable.

Mr. Neville Sandelson: I am interested in the hon. Gentleman's philosophy. When he talks of rewards, does he think that those rewards should be for the benefit of, for example, the child of well-off parents compared with the child of poor parents, either in the medical sphere or, for that matter, in education? Does he think that the better-off have a natural right, simply through their possession of rewards, and that they should be enabled to have greater enterprise in passing on those rewards for the benefit of children or members of their own families to the exclusion of those who are less well off?

Mr. Miller: I fear that the hon. Gentleman has not been listening to my arguments.

Mr. Sandelson: I have.

Mr. Miller: I am talking about rewards for performance. We are not discussing inherited wealth or inherited advantage.

Mr. Sandelson: Nor am I.

Mr. Miller: We are discussing the excellence of performance and rewards for performance. That has nothing to do with what goes on in respect of children. We need to encourage initiative and excellence in the National Health Service. I have been discussing the benefits that accrue to the National Health Service from the presence in that service of consultants of standing.
I should like to cite an instance. I refer to the Midland Neuro-Surgery Centre, which is an example of the sort of co-operation which should commend itself to everybody. It was established in 1949 by the Birmingham Regional Hospital Board. It was opened in 1954. Since that date there has been the most remarkable advance in the treatment of patients. There was only one pay bed in that hospital. Private practice is carried out by the consultants' team established there, which has attracted to this country not only patients but considerable resources from the private sector for the further development of the facilities of that centre and of extensive post graduate medical education and research. None of that would have been possible without the additional resources made available from the private sector not merely to the National Health Service as a whole but to a man who had shown himself capable of excellence, who developed the technique, who built up the team and who showed himself capable of further advance. That form of co-operation should pave the way. It should not be rooted out in pursuit of some theoretical egalitarianism.
In Questions in the House I have referred to the need for the further regulation of the profession. I said earlier that reputations were made and retained in the public sector. However, I hope that the Minister will pay attention to that fact and ensure that performance is the criterion for the appointment of consultants.
We have heard a great deal about consultants paying too much attention to their private patients. There is a great deal of hypocrisy in remarks of that sort.
It is equally well known, although not so frequently uttered, that there are full-time consultants on the skive, if I may so describe it, in the health service, just as much as there are private consultants who take too much time out of the health service to look after their private patients. We are not concerned with "two bit" consultants of one kind or another. We are concerned with those who are capable of making a real contribution.
I hope that the Minister will look into the question of instituting short-term consultants' appointments, so that continuing performance will be the requirement for further appointment or subsequent promotion, rather than the system of merit award. I join forces with Government supporters who have opposed that system. I hope that in his concluding remarks the Minister will assure us that that aspect is being look at. The contracts need to be dynamic, not static. They should not be regarded as a kind of parson's freehold once a person becomes a consultant at the age of 30 or whatever the age may be. We should pursue excellence, not egalitarianism. We should strive for emulation and not envy, for cohesion and not division.
The measures which were announced by the Secretary of State bring no guarantee that waiting lists will be shortened. They give no assurance that if private medicine is to be separated, which is most regrettable, it will be allowed to continue and develop.
The right hon. Lady's predecessor who started off this whole service once said that imaginative tolerance was the mark of a civilised mind. The intensity of the right hon. Lady's passions and her political commitment are well known, but I hope that she will find time to pause and reflect upon this verse from the Litany:
From all blindness of heart; from pride, vain-glory, and hypocrisy; from envy, hatred and malice …Good Lord, deliver us.
I hope that she will also deliver the National Health Service.

8.55 p.m.

Mr. Bruce Grocott: The hon. Member for Bromsgrove and Redditch (Mr. Miller) has attempted at least, albeit forlornly, to elevate the Opposition's arguments to the level of principle. He was one of the


first Opposition speakers to do so. The principle which he tried to enunciate was the pursuit of excellence. One of the reasons why a debate of this kind, which affects only a relatively small part of our national life, seems to arouse such gut reactions on both sides of the House and amongst both the main political parties is that it is about a principle which separates us and is fundamental in the gap dividing us.
The hon. Member for Bromsgrove and Redditch talked about the pursuit of excellence. If I may try to put it in terms which he will probably defend, he seems to be saying that, somehow or other, inequality, whether it be inequality of income or, in this case, inequality in medical care and medical provision, is defensible because the inequality itself leads to an improvement of standards, to an expansion of provision and, in the long run, to a better medical provision and better medical care. That viewpoint runs through Tory Party philosophy at all levels of its arguments.
The view of Government supporters is almost exactly the opposite, but I shall come to that in a moment. I say simply that the view put forward by the hon. Member for Bromsgrove and Redditch, that inequality in the National Health Service or in any other area will somehow lead to better standards for everyone, is defensible only to those who believe that the cake—in this case the cake of medical care—is infinitely expandable and can go on getting bigger and bigger; therefore, that it does not matter how big one's slice is; in other words. if the cake is getting bigger the inequalities do not matter because the small slicers are getting bigger just as the large ones are.
As soon as anyone begins to appreciate that there is a limit to the size of the cake—and for all practical purposes there is a limit to the size of the National Health Service cake—the argument moves away from the inequalities and towards the importance of ensuring that whatever we have is distributed fairly and evenly. The argument of Government supporters is that the distribution must be on the basis of need, which in this case means medical need.
If the Opposition attempt to defend their viewpoint on the level of principle,

though I suspect that they know they cannot if they think for a moment of the queue-jumping which goes on, and if they once accept that this inequality exists and that the cake is limited in size, logically they will be obliged to look for equality in the distribution of resources. which is all-important.
I am still searching for the principle behind the Opposition's motion. I should like some concrete answer from an Opposition Member to a simple question. Is what they are doing at the moment trying to defend the existing balance between private beds and the other beds in the National Health Service, or do they feel that the balance should be shifted one way or the other?
It seems to me an odd accident of fate if the figures that we have at the moment —3·1 per cent. of beds in acute hospitals, or 3,042 out of 98,213—give a balance that is magically just right to allow this pursuit of excellence, of which the hon. Member for Bromsgrove and Redditch and other hon. Members have spoken. It is possible that that balance may need to be altered and that far more of these beds should be provided. It really is a most fortunate coincidence if we have achieved the right balance.
However, this is not the principle on which Conservative Members are operating. They are concerned simply to hold the line as it stands and to make a last-ditch defence of pay beds.

Mr. Hal Miller: When the Minister replies I hope he will be able to assure the hon. Gentleman and myself that the number of pay beds is flexible and that a maximum limit is set. But if pay beds are not taken up—this is a question on which the Minister should be pressed—why is there not a greater occupancy of those pay beds by National Health Service patients? This is in addition to my point that there is an entirely false argument about the waiting list and the effect on it of the abolition of pay beds.

Mr. Grocott: This is an Opposition motion. It would be interesting to know the balance which the Opposition would like to see made in the health service, and whether they look on the high or the low side. What is this magic figure which will allow the pursuit of excellence, of which we have heard so much?
Not only is this motion wrong in principle, for the reasons I have suggested, but it is absurd in some of its details, especially where it says:
That this House believes that the abolition of private beds in National Health Service hospitals would be against the interests of the patients…
I should be interested to know which patients hon. Members opposite are talking about. No doubt they will respond "Oh, all patients." It is patently not in the immediate interests of the patients in private beds. It is a strange view to hold that all patients will suffer from the removal of a few private beds.
On the contrary, the best possible guarantee that people in this country can have of the excellence of the National Health Service is that everyone in the community, whether wealthy or poor, influential or with no influence, in positions of authority or with no authority, should be subject to the same kind of medical treatment. That is the finest guarantee that can possibly exist.
As soon as we have a situation, in this society or in any other, in which the influential and the leaders can opt out of a system and acquire for themselves privileged facilities in whatever area, it is at that point that the rights of the community start to decline and standards start to decline. Philosophers have recognised, for as long as they have talked about this subject, that it is vital that the people in authority, those in Government and those who lead industry, should have exactly the same kind of provision as the rest. That is the only possible safeguard that the rest of us can have.
Let us try to see that this debate is conducted at the level of principle. I have heard of no principles that are satisfactory or that I can understand from Conservative Members yet. They have been strangely quiet and mute throughout most of the debate. However, if they have a principle that they can defend, which stands up and which is one other than simply the defence of queue jumping, in the relatively few minutes that remain for this debate I think that the House would like to hear it.

9.4 p.m.

Mr. Paul Dean: The right hon. Lady the Secretary of

State was vague in some parts of her speech, and she was contradictory in others. There were veiled threats in one part, and, above all, there was the usual criticism and abuse of the medical profession which one hears from her in very nearly every speech she makes.
Of course, there arc some black sheep in the medical profession, as in any other. Where there is queue-jumping, it is an abuse of the system that no one on the Opposition side of the House would defend. But it is quite wrong for the right hon. Lady—who has left the Chamber for the moment—to tar the whole of the medical profession with this brush. When will she learn that she cannot, and will not, win the trust of this honourable and dedicated profession by trying to visit the sins of the very few on them all? She ought to have learned this already through the discussions she has been having over the consultants' contract and other matters of that kind.
It was very significant that the right hon. Lady, in making a very long speech —it went on for over half an hour—said not one word about the effect of her proposals on the emigration of the medical profession from this country. Not a word was said about that, but, of course, we know that medicine is international and that if doctors are not satisfied with the conditions provided in Britain they can very easily take their services elsewhere.
I mentioned that the right hon. Lady was vague. She was vague in particular about the cost of her proposals. Here is a Minister who comes to the House boasting that for many years it has been the policy of her party to phase out private beds in the National Health Service, but she cannot even give the House an estimate of the amount of revenue that will be lost. When I pressed her on the matter she made some vague statement to the effect that it was difficult to get an exact indication of the cost. Here is a Minister who spends more public resources than anyone else, and one really would think that when she comes to the House with a proposal which will lose revenue to the National Health Service she would at least have some estimate of the cost.
I shall try to give that estimate for the House. My reckoning is that the loss


of revenue to the National Health Service as a result of this proposal could very easily be £50 million a year; indeed, possibly more than that. One must also take into account not only the loss of revenue from paying patients but also the risk, to which I shall come shortly, of the loss of resources, research money, equipment and other things. We hear about the problems of queue-jumping. One of the reasons why we hear about these problems is the waiting lists. Those lists are likely to be longer, not shorter, if the right hon. Lady is denying herself the substantial sum of money which at present comes in from the private patients.
Then the right hon. Lady was contradictory. We now have a new doctrine on amenity beds. It is all right to pay as long as one does not pay the full cost. That appears to be the new Socialist doctrine which is involved in relation to payment in the National Health Service.
Then there are the overseas patients. It is all right that they can come here, as long as they do not pay—as long as the British taxpayer pays. These are really the most extraordinary reasons to put forward for this proposal.
Finally, I mentioned the veiled threats I am thinking particularly of the new proposal which was mentioned, but in no way developed, about a licensing system. Licensing for what? I hone that the Minister of State will be able to tell us a great deal more about what the Government have in mind. I appreciate that consultations are to take place, but surely the Government must have some indication of what they have in mind, otherwise they would not have come up with this proposal tonight. Licensing for what? For fire hazard? For hygiene? For staffing standards? The Government already have power to do that. What else can it be? I have an ugly suspicion that this is licensing for quantity, that this is a disguised way to try to squeeze out private medicine in this country, to deny people the freedom to pay for the health of their families, if they wish, and to deny doctors the freedom to practise privately. I hope that the Minister of State in reply will tell us that this suspicion is entirely unfounded. If not, this is easily the most

sinister and serious statement so far made in the debate.
Against that background I should like to give some reasons why. in my judgment, the National Health Service and the private sector are complementary. I declare an interest, as I think the House knows, in health insurance and an organisation which provides not only health insurance but medical facilities.
I believe that as a result of this proposal the National Health Service will suffer and that its patients will suffer most. I say that for three main reasons. The first is the loss of revenue, to which I have referred. The second is the real risk that skilled medical manpower will find working conditions in this country so hostile that they will take their services abroad. One point about British medical education is that those who have been trained here are in great demand in other countries. Therefore, there is a real risk that the shortages that we already suffer in our hospitals will be accentuated by this measure.
The third reason relates to beds in the private sector which are at present on contract to the National Health Service. Have the Government thought about that matter? I hope that the Minister of State will be able to tell us. Beds in the private sector fulfil a vital role in the provision of health services and facilities as a whole.
The final point concerns the pioneering work which is often done by the private sector. There are numerous examples. I will mention only two.
The first concerns preventive medicine. The State is often hesitant regarding research into preventive medicine because it has to cope with an enormous load of ill health and the treatment that is required. But BUPA is an organisation in the private sector which has been pioneering health screening and medical check-ups in this country. It is now doing good work in one particular aspect of health screening of great concern to women— cancer of the breast. Not only does it have facilities at its medical centre in London, but those facilities are now available on a mobile basis throughout the country. That is one example of pioneering.
Another even more sophisticated example concerns research into and treatment for cancer. I think that it is fair


to say that we are leaders in this sphere. The facilities for radio-therapy in the NHS have been developed by a combination of Government finance and private donation. The multi-disciplinary teams, which have been working and growing together, have world-wide reputations. However, that could not have been done on National Health Service funds alone. Much of the expensive equipment and research funds and, indeed, the after-treatment accommodation, has been provided by private individuals or groups.
I fear that if these links between the private sector and the National Health Service are severed there is a real risk that the private donations which go to the NHS will go to private clinics. There is a real risk that the multi-disciplinary medical teams which are now happy to work in this country will find themselves going to more attractive facilities in the United States, France and other places which have similar enterprises. There is a real risk, too, that patients who now come from abroad will also go to these other countries.
This is an occasion on which the right hon. Lady has written her own epitaph while she is still in the job. She has united the doctors for the first time ever by her unfeeling and dictatorial attitude. She has been too weak to prevent mob rule in the National Health Service. She has severed the links between the NHS and private medicine, thereby depriving the National Health Service of consultants, research projects and money. In sum, she has created two standards of service. What a monument to Socialism in the National Health Service Barbara Castle style!

9.16 p.m.

Mr. Peter Viggers: First I should declare an indirect interest, although it is not connected with private medicine. My wife is a doctor working part-time as an anaesthetist in the NHS. We have no financial interest in private medicine. I think that the first and overwhelming interest of everyone here should be, and mine is, to improve the National Health Service.
The National Health Service has severe problems. Over recent years it has been moving from a doctor-controlled system which is paternalistic in tone and based essentially on personal and local relation-

ships. That type of system is becoming a thing of the past, and instead we are getting a health service which has all the features of big business. It is controlled by specialist administrators and its keynote is efficiency. Within this system doctors, even specialists who are leaders in their fields, take their place as middle-grade executives. They do not like it, but it is true.
The change which I have been describing is inevitable, but it is one which has caused problems and pressures within the medical profession. The change has been accelerated by the extraordinary growth in the number of old people who need care and some degree of medical attention. Increasingly the problems of the social services are those of old people, with specialist medical and surgical care remaining critically important but forming an increasingly small proportion of the overall picture. The growth in the number of the elderly has caused a drain on financial resources and the National Health Service is under great pressure from lack of money and lack of staff.
From the point of view of the doctors there are other pressures. A large number of doctors in the NHS, and particularly in hospitals, come from abroad. Many have a limited ability to speak English and this, combined with their training in a completely different cultural environment, means that communication between doctors and patients is often defective. It is difficult to weld together an efficient team from people of widely different training and background.
The other side of the same coin is that doctors of the greatest ability are finding emigration increasingly attractive. Several of the most capable hospital doctors have said that they feel that they have no alternative but to leave this country. This argument derives partly from unattractive pay and high tax rates in this country but mainly from loss of status and responsibility which follows the downgrading of the medical profession.
That is the background, and those are the conditions, that we are talking about when we discuss the controversial issue of pay beds.
At present a consultant may be either full-time or part-time. When a position as part-time consultant becomes vacant, the calibre and range of persons who


apply for the job is higher than the calibre and range of those who apply for full-time jobs. Part-time consultancy practice, with the ability to take on private patients, is attractive from a doctor's point of view, and this deserves to be taken into account, but the paramount interest is that of patients under the National Health Service.
On that I make three points. First, the pay bed system is a compromise, but it is an efficient compromise which allows the highest quality medical staff to give most of their time to the National Health Service at a comparatively small cost to that service.
To eliminate pay beds would cost, we are told, about £30 million annually, or probably more. I do not know whether we are becoming punch-drunk on figures, but last week, having been told by the Chancellor that we had a borrowing requirement of £9,100 million, we discussed the expenditure of a further £6,100 million, taking into account £3,000 million to £4,000 million on the Community Land Bill, £1,200 million on British Leyland, £900 million on the British National Oil Corporation and another £500 million or so on aviation and shipbuilding. But we should not be so punch-drunk as to forget that £30 million or more is an important amount.
The second point is that of individual choice. Surely it is right to have as wide a range as possible available to people in medicine as in other things. The effect of choice is far more important than the right of a few individuals to decide their own medical treatment. A small number of people who can make a choice has a leavening effect on the whole system and adds an edge by focusing attention on the best within the system.
My third point relates to amenity beds, which I described earlier as a commissar system. I am glad to be able to expand on that. I am sure that it is right, for instance, that Members of the Cabinet should have private rooms so that they may keep their papers confidential and work upon documents and have private discussions with their staff. Similarly, many people in positions of responsibility and confidentiality should have private accommodation. But who is to say that a Cabinet Minister deserves and needs

privacy but that a less exalted individual who seeks privacy should not be able to have it in the National Health Service?
Pay beds in hospitals may be capitalist beds—I am not against capitalism—but amenity beds are commissar beds. By that I mean that when we eliminate pay beds and encourage amenity beds, what we are doing is limiting the choice of the individual and broadening the power of the people who allocate privileges. That is what I mean by a commissar system. That is why the current debate is so important and raises such important points of principle.
If this principle of abolition is set over pay beds, it will not help the NHS. I understand that meetings are being held this week with British Airways—a completely different organisation but nevertheless a nationalised one, in which the pilots have no alternative but to work for that employer. The fact that the Government are the sole employer has not prevented about 40 senior pilots, some on salaries of £14,000, from demanding salaries of about £28,000 to fly Concorde. That is an example of the Government being the sole employer but not being able to prevent individuals from demanding high wage increases.
The principle could extend further. If we reject a working compromise in medicine and pursue a doctrinaire line there, the same principle could be applied to Parliament: arguments could be amplified that MPs should be full-time servants of the State, not part-time. That argument is fallacious, just as the argument is fallacious in medicine.
The Labour Party has not always been too bigoted to accept compromise. Aneurin Bevan accepted compromise when he set un the National Health Service. On Second Reading of his National Health Service Bill he said:
The same principle applies to the hospitals. Specialists in hospitals will be allowed to have fee-paying patients. I know this is criticised and I sympathise with some of the reasons for the criticism, but we are driven inevitably to this fact, that unless we permit some fee-paying patients in the public hospitals, there will be a rash of nursing homes all over the country. If people wish to pay for additional amenities, or something to which they attach value, like privacy in a single ward, we ought to aim at providing such facilities for everyone who wants them. But while we have inadequate hospital facilities, and while rebuilding is postponed it inevitably happens that some people will want to buy something more than the


general health service is providing. If we do not permit fees in hospitals, we will lose many specialists from the public hospitals for they will go to nursing homes. I believe that nursing homes ought to he discouraged. They cannot provide general hospital facilities, and we want to keep our specialists attached to our hospitals and not send them into nursing homes."— [Official Report, 30th April, 1946; Vol. 422, c. 57.]
With that I completely agree. Again I quote Mr. Aneurin Bevan, who told the Standing Committee on the Bill:
I admit at once that specialists are being given very favourable treatment, but I believe that by this means we shall eventually obtain a far higher standard of service for the patient. Let me answer one or two points in order that I may illustrate what I mean by that.… What we are endeavouring to do, and what we must try to secure, is that the specialist is induced, as far as possible, to spend all his time at the hospital, both for his own sake and for the sake of the patients in the hospital. and—in the case of the teaching hospitals—for the sake of the students, and indeed, the whole atmosphere of the hospital…would point out to my hon. Friends that it might not only arise in this country.
He was then talking about the growth of nursing homes. He concluded:
There is speedy transport available now, and we might find the specialists hopping across somewhere else, and attending patients there. We should then be losing the services of those men who are, after all, invaluable in the present circumstances."—[Official Report, Standing Committee C, 21st May 1946; c. 1155.]
That is the answer to any pleasure that the Secretary of State may have from curtailing or limiting private nursing homes. That is the answer to the abolition of pay beds.
The Labour Party should now be broad enough and far-sighted enough to realise that compromise is often far better than dogma. It should respect the views of the medical profession and above all pay regard to the interests of the patients by allowing pay beds to continue.

9.26 p.m.

Dr. Gerard Vaughan: We have had a wide-ranging debate and some heartfelt views have been expressed from both sides of the House. I have a deep devotion to the National Health Service. I do not think that anybody brought up within it, as I have been, could feel otherwise. Any remarks that I make are not in any way an attack on the service. It has been suggested by several hon. Members this evening that the Opposition do not want the health service to continue

in its present form. They know and we know that that is deeply untrue.
One thing that the debate has demonstrated is how complex is the situation that we arc discussing and how very unwise it is for the Secretary of State—I am sorry that she is not here now; having taken her 35 minutes, she obviously has other duties that have called her away—to run the risk of disrupting the service by ending pay beds.
Sadly, the debate has followed a wholly predictable course. My hon. Friend the Member for Sutton Coldfield (Mr. Fowler) presented us with a cogent and closely reasoned statement of why the motion was before us and why pay beds should be retained. That was followed by the extraordinary and unclear statement by the right hon. Lady. It was as important for what she did not say as for what she said. I understood her to propose the abolition of private beds by legislation. Like the reluctant lover, she wants to say "Yes" but she will not say when—this year, next year, some time, but never "Never". That is not satisfactory to the House and I hope that the Minister of State will confirm that at any rate it cannot be in the current Session, because there is not the legislative time.
The right hon. Lady tied herself into knots over privilege and principle. It is apparently wrong to buy privacy by patients' private facilities and yet it is right to buy privacy and privilege by subsidised beds, which is what amenity beds are. It is all right to pay a little but it is quite wrong to pay a lot. We hear a good deal about philosophy and underlying principles, but I cannot see that if the principle is right for amenity beds it is wrong for totally private, fully fee-paying beds.

Mrs. Knight: Could my hon. Friend also explain how it can be right to have private beds for foreign visitors and yet not right to have pay beds for people who live in this country?

Dr. Vaughan: I am grateful to my hon. Friend. I shall come to that point later if there is time.
Most of all, the Secretary of State has attacked queue jumping. Why? We all know that there are no queues for acute cases. As the hon. Member for Truro (Mr. Penhaligon) said. it is not the queues


but the length of the waiting list that matters. My hon. Friend the Member for Somerset, North (Mr. Dean) has pointed out that we do not accept queue jumping. It is a deplorable practice which we would not countenance in any circumstances. What is the right hon. Lady's solution? She puts forward a single waiting list. I tell the Minister of State that I do not see how it will work—[Interruption.]I am pleased to see that the Secretary of State has joined us again. Had she arrived a moment or two earlier, she would have heard me say that she has proposed the solution of a single waiting list.
As a medical person, and I have no vested interest in private beds, I cannot see how a single waiting list can be made to operate. I ask the right hon. Lady, through the Minister of State, to tell us what she proposes. Are we to go down the list and say "Yes, that person will come into an amenity bed at this stage" without regard to any convenience for that person, without taking account of people's employment? Are we to say that someone from overseas will have to wait in a queue after he has made arrangements to come in? I do not understand what the Secretary of State has in mind.
The most significant part of the right hon. Lady's speech concerned licensing. This seemed to be a direct threat to the medical profession. Licence for what? Licence on quality or quantity? If it is on quantity, it must be a licence to say "Thou shalt not practice medicine in this place, of this quality, of this standard". That seems to be a gross intrusion into the fundamental rights of democracy.
By all means let us have licensing throughout the health service. Let us licence National Health Service facilities and private facilities. Let us licence them for quality. I assure the right hon. Lady, and she knows this, that many of the worst examples of medicine are to be found not in the private sector but in the NHS sector. That could benefit from regular inspections from her Department. Licence for standards by all means, but not to set an arbitrary limit on numbers, not to bring about a refusal to allow people to set up, for example, private nursing homes where there is a need for

them. I hope that the Minister of State will tell us exactly what his right hon. Friend means.
I hope that before making her extraordinary statement the right hon. Lady consulted at least the spokesmen of the medical profession. If she did, what was the reaction? Did she issue a diktat telling them only what would happen, or has she really gone in for discussions with them as an employer with her employees? That is what she was advocating last year. My hon. Friend the Member for Sutton Coldfield has explained why the pay bed issue is irrelevant because it solves none of the major problems besetting the NHS.
The Secretary of State knows that we are facing a period in the NHS when morale is at a low ebb. This is a time when 65 per cent. of kitchen and ancillary staff come from overseas, as do 67 per cent. of junior doctors. It is a time when reorganisation of the service has so far failed to reduce the muddles and uncertainties and the lack of decision which besets the service. It is a time when accidents in the service—and that means deaths in many cases—are increasing. Anybody within the health service will confirm what I am saying.
It is at a time when the most serious thing of all has happened, something which I thought could never be brought about, at a time when in the last year, under the right hon. Lady's direction, a great vocation, because that is what medical service has meant, has been turned into a job. Many doctors are now forced by the right hon. Lady's actions to look at their natural vocational interests as a term of work. As a result of recent conflict, many of them will not go back to their previous modes of working. The right hon. Lady knows this. There has been a fundamental and major change within health service attitudes within the last year.
Surely it is reasonable to ask the right hon. Lady why she is doing all this at a time when there is a massive shortage of resources within the health service and why she is trying to alter something which has worked satisfactorily over the past 25 years. It was an arrangement which the vast majority of the medical profession—whole-time as well as part-time, junior doctor as well as senior doctor—asked should continue.
Why not consult the medical profession before doing this? The right hon. Lady knows, just as I know, that no proper consultations took place.
We had a very sad foretaste of today's debate in 1972 when I had the honour to sit on the Expenditure Sub-Committee under the wholly impartial chairmanship of the hon. Lady the Member for Wolverhampton, North-East (Mrs. Short). Unfortunately, the hon. Lady is not in the Chamber, but I gave her notice that I intended to raise this matter tonight.
The hon. Member for Fife, Central (Mr. Hamilton) talked a great deal about abuses by doctors within the health service. We on that committee, under the hon. Lady's enthusiastic chairmanship, with great care—with almost desperate care, I would say—searched for a justification for the view that private beds had caused harm to the health service, that they had led to resentment by more than a very small number of the staff, that there was corruption and abuse.
We were presented with a number of very vague and general accusations made by a small group of important people within the health service. When we tried to substantiate them and find actual examples we were unable to do so. In fact, at the end of that inquiry we came to the opposite conclusion, although I am sure that there are individual instances of abuse. We found that the part-time doctors put in great amounts of time over and above their contracts and that private work brought in assets to the National Health Service.
In the time available I shall find it difficult to do more than touch on these, but there are five reasons why private beds should remain within the National Health Service. I know of no country —[Interruption.]—where a wholly State system has been able to maintain a high level of medical care. I am very concerned indeed about the effects on emigration. [Interruption.] One organisation tells me that within the last six months there have been 59 resignations of consultant colleagues who are planning to leave the country. [Interruption.] Another organisation tells me that about 170 consultants and 52 senior registrars have gone abroad. [Interruption.]

Mr. Speaker: Order. I am trying to conduct this debate so that the Minister will be able to rise quite quickly. This sort of behaviour is delaying matters.

Dr. Vaughan: About 170 consultants and 52 senior registrars have gone abroad in approximately the past year. When answering a question this week the right hon. Lady said that she was very concerned and keeping a close watch on the situation. To have figures which are two years out of date on a situation as critical as this is not satisfactory, and she should urgently have them brought up to date.
There are also overseas reasons. I have a letter from one of the universities saying that there would be serious damage to the experience which people can get in their training if patients did not come to this country from overseas.
There are, of course, the aspects of income from patients as well as from relatives. There is also the waiting list reason. At present, at least 11,000 beds are empty because of the shortage of nurses. On any one day in the National Health Service, about 80,000 beds are empty. That is where the Secretary of State should be looking for the cure for the waiting list.
Many of us have found the attitude of the Secretary of State increasingly worrying in recent months. At a time when the most urgent and pressing problems are besetting the National Health Service, she either attacks the private sector, as she has done today, or chooses to remain silent. She was silent when at the Westminster Hospital a small group of non-medical people endeavoured to "stir it up" and starve out patients. She was silent when a small group of non-medical people at the Holt Radium Institute tried to dictate who should or should not have investigations for urgent treatment. She was silent at Portsmouth recently when a small group of non-medical people not only stopped volunteers from working in the National Health Service but stopped them from doing jobs which they could not take over themselves.
We know the Secretary of State to be a courageous, sensitive and humane woman, and I plead with her to recognise now the errors she is making within the National Health Service before the whole thing collapses about her feet.

9.43

The Minister of State, Department of Health and Social Security (Dr. David Owen): In some ways this has been a depressing debate. From the Opposition benches we have heard nothing about the feelings of the staff in the National Health Service. We have heard one small section of the National Health Service interests constantly represented—the consultants who elect to do private practice.
It is worth remembering that many thousands of our doctors do not undertake private practice and deliberately decide not to collect fees. The debate would have been better balanced if we had heard a little about that. Many other people in the National Health Service, whether they be nurses, ancillary workers or scientific staff, also have very strong feelings about the issue of private beds.
We have not had any recognition at all from the Opposition of the problem that faces any Secretary of State. It must be recognised that the problem of private beds and private practice existing in the National Health Service is one that will affect any Secretary of State for Social Services who is looking at the whole of the National Health Service and not just a small section.
We have heard little from the Opposition about the small number of private beds in Scotland or Wales. Are they unable to have high standards of medicine? What about the great London teaching hospitals? St. Bartholomew's Hospital by statute is unable to have private practice. Are we saying that its standard of practice has deteriorated and that it is unable to attract doctors? What about the University Hospital of Wales at Cardiff? There are no permanently authorised pay beds allocated there. A better balance in the debate would certainly have helped it.
Hon. Members opposite have suddenly discovered the great patron saint of Conservative values, Mr. Aneurin Bevan. The many quotations of what the founder of the National Health Service said have been one of the most striking features of the debate. We have had a canonisation of Aneurin Bevan. In a chapter on a free health service in "In Place of Fear" in 1952 he said:
Another defect in the service which was seen from the beginning is the existence of pay beds in hospitals.

He goes on to discuss the concept of geographical and whole-time service. Eventually he said:
The number of pay beds should be reduced until in course of time they are abolished unless the abuse of them can be better controlled. The number of amenity beds should be increased.
It is important that the hon. Member for Sutton Coldfield (Mr. Fowler) should understand what an amenity bed is. He seemed to think that one could understand the abolition of pay beds if it were accompanied by the abolition of amenity beds. He said that the principle was exactly the same. The principle is not the same. The first thing about amenity beds which needs to be established is that anyone who is granted such a bed does not have a pre-emptive right to it. If someone else in the hosptal becomes seriously ill and needs a single room on medical grounds, the person in the amenity bed can be, and would be, moved.
The second and perhaps most important principle after that is that the treatment which a person gets in an amenity bed is exactly the same as any NHS patient get. Unlike the private patient, such patients do not buy scarce skills. Unlike the private patient, they do not buy a place in the queue. They do not jump queues. What an amenity bed gives them is the right to privacy. People who take an amenity bed purchase privacy. [Interruption.] We now understand that the freedom which the new Tory Party will espouse is that one should not be able to purchase a modest measure of privacy.

Mr. Norman Fowler: What we on this side of the House are trying to preserve is the present compromise. We are pointing out to the hon. Gentleman the total inconsistency of what he is putting forward. However he seeks to argue it, some people can afford to buy privacy and amenity beds and some cannot.

Dr. Owen: The hon. Gentleman must recognise that if pay beds are phased out completely about 3,000 beds will be made available for the National Health Service. That is the proportion in use, because the 4,500 are not fully utilised. In reply to the hon. and learned Member for Runcorn (Mr. Carlisle), may I point out that the under-occupancy of acute beds in the private sector is still considerable


—about 55 per cent.—and of equivalent beds in the National Health Service it is 76 or 78 per cent.? There is a slight difference from figures quoted earlier but not a great difference.
If the present pay beds become available—and most of them are in single rooms—some will be available for NHS patients as amenity beds, and many of them, probably the vast bulk, will be available to NHS patients without any payment. The privacy which we on this side of the House value every bit as much as the Opposition will be made much more available for everybody in the health service.
The Opposition find it very hard to understand that we want to improve the service. We want to make privacy more widely available to people. We should like people to have greater choice during the time they are in hospital, and we want to ensure that people obtain not only the best treatment available but the best service available. It is an odd way of trying to strengthen the service to put an obstacle in the way of NHS patients having privacy.
Having dealt with that matter, I come to the question of finance. The cost of pay beds is not just a revenue cost—an estimated £17 million for the last year for England and about £20 million for Great Britain. The Opposition should also put into the equation the capital costs and the capital gain. What the National Health Service will have available is the addition of new beds in some hospitals. Some hospitals will have, for example, the disadvantage of beds in separate private wings. Such beds are very costly to run, and they may well decide not to continue using them. But there will be at Charing Cross Hospital. for instance, the addition of some 40 new beds. They will suddenly be made available to the NHS representing a capital cost of anything from £1¼ million to £2 million. That example can be repeated in many new hospitals throughout the country.
I have been asked about costs, and I point out that we have said that we will meet any additional revenue cost. There will not be a charge on the health authorities. But we cannot give an exact costing of course, we have to take account of the revenue costs.
The beds in new hospitals will provide additional facilities but we might decide not to continue to run beds which are now very expensive to operate. Those beds may be found in places where it is not possible to run NHS wards for lack of nurses or where we have to continue to run private pay beds because we are committed to do so. It is impossible to put a cost on these matters. The one thing that should come out of this debate loud and clear is that the cost will not be borne by the NHS authorities.
There is no Government with a better record of increasing resources for the NHS than this one. The Government have increased spending on the NHS over and above the figure that was cut by the Conservatives in 1973. That is a fact that Conservatives find difficult to understand. The Government have lifted the moratorium on all hospital buildings. On coming into office we faced the possibility that we would not be able to start any new hospital buildings. However, we have increased the resources in both capital and revenue terms. There has been a larger increase in the percentage of the gross national product devoted to the National Health Service than has ever occurred in any one year. That will be seen when the final estimates are completed for the past year.
I turn to some points of detail. I deal first with the hon. Member for Somerset, North (Mr. Dean), who raised the question of licensing. He asked whether there was an intention to stop private patients choosing to have private care. The answer is "No". We are embarking on a policy of separation. In the same speech the hon. Gentleman asked for greater contact between the NHS and the private sector. He must know that that sort of contact is a subject for discussion and consultation and that the balance is a difficult matter to decide.
It is problems of that sort that must be dealt with by licence. The one thing that my right hon. Friend is not prepared to accept is the emergence of anything which will damage the NHS. It is not easily understood in the House that our present powers of licensing are limited. It is possible, for instance, under the Medical Termination of Pregnancy Act 1967, to refuse to allow an operating theatre to be used for an abortion in the private sector in a private clinic, yet the same


operating theatre can be used for a major operation, such as a gastrectomy, without our having power to intervene. There are many areas of licensing which need to be discussed.
It is in that spirit that we shall enter into discussions. We shall have the firm determination not to allow the growth of the private sector to damage the NHS.
The retention of medical staff has been raised constantly. It is interesting that in evidence to the Public Expenditure Committee which considered the whole question of private medicine the Royal College of Physicians of Edinburgh stated that the fears that consultants who were deprived of adequate private patient facilities would emigrate was exaggerated. That attitude probably stems from their experience of having little private medicine in Scotland. People leave the National Health Service and this country for reasons quite apart from the existence or otherwise of private practice. They are much more likely to be concerned with lack of facilities.
The hon. Member for Somerset, North spoke about private beds on contract. That is not an issue. There is nothing in our plans for phasing out which will affect them. They are mainly denominational: they provide long-term care which is extremely valuable.
On the question of bed utilisation, we know of hospitals with two or three private beds where it is not easy to secure a high rate of occupancy of well over 50 per cent. We propose to reduce the beds more where the occupancy figure is less than 60 per cent. We hope to make a 10 per cent. reduction overall, although we shall be prepared to hear representations from anybody in the localities concerned if people feel that this acts unfairly.
The main point of principle raised in the debate was raised by my hon. Friend the Member for Bother Valley (Mr. Hardy) and my hon. Friend the Member for Lichworth and Tamfield—I mean—[Laughter.]—Lichfield and Tamworth (Mr. Grocott). Hon Gentlemen should not laugh at these matters. Mention was made of the size of the National Health Service cake. The facts of life are that no health service in this country would be able to meet all the demands

and all the requests made on it. We have, in effect, a rationed service. There can never be a health service that can meet all demands. It is in that context that we must look at how we can distribute resources fairly and evenly. This is the problem for the NHS.
Labour Members and also Liberal Members are concerned about the allocation of scarce skills. They are skills which have been well developed in the National Health Service, and reputations have been built at a high cost to the National Health Service. These medical personnel have been trained first as registrars, then as senior registrars and then as consultants. Those scarce skills should be allocated to patients who most need them, not to the patients who can most afford them. That is the issue of principle.
Conservative Members should face the fact that when they seek to purchase private practice they are purchasing scarce skills. It is the allocation of those scarce skills that matters. Conservative Members would also purchase earlier treatment. We have heard some conflicting evidence from the Opposition about the role of queue jumping. The same hon. Gentlemen who speak about queue jumping do not seem able to support us when we go to the profession and ask for a common waiting list. Will they give some idea of how they would avoid queue jumping? The hon. Member for Plymouth, Sutton (Mr. Clark) revealed the true Tory mind. He said "If people wished to jump the queue, why on earth should they not do so?" The hon. Member for Gosport (Mr. Viggers) talked of capitalist private beds and commissar controlled amenity beds.
We on the Labour benches believe that the National Health Service involves ethical principles, values of altruism, values that we believe are worth maintaining. We are determined to see that the NHS is strengthened by the separation of private practice. We believe that the law of the market place has no place in the NHS. Conservative Members who so recently have discovered Mr. Aneurin Bevan should remember what he said:
A free health service is a triumphant example of the superiority of collective action and public ownership applied to a segment of society where commercial principles are seen at their worst.


We believe that the existence of private medicine in the NHS damages the expression of altruism displayed by all the staff who work in it. We do not want to see profit being made in NHS hospitals and laboratories. We reject the law of the market place and I ask the House to reject the motion.

Question put,
That this House believes that the abolition of private beds in National Health Service hospitals would be against the interests of the Health Service, the patients and the medical profession:

The House divided: Ayes 246, Noes 278.

Division No. 196.]
AYES
10.0 p.m.


Adley, Robert
Galbraith, Hon T. G. D.
Macfarlane, Neil


Aitken, Jonathan
Gardiner, George (Reigate)
MacGregor, John


Alison, Michael
Gilmour, Rt Hon Ian (Chesham)
Macmillan, Rt Hon M. (Farnham)


Amery, Rt Hon Julian
Gilmour, Sir John (East Fife)
McNair-Wilson, M. (Newbury)


Arnold, Tom
Godber, Rt Hon Joseph
McNair-Wilson, P. (New Forest)


Atkins, Rt Hon H. (Spelthorne)
Goodhart, Phillip
Madel, David


Awdry, Daniel
Goodhew, Victor
Marshall, Michael (Arundel)


Baker, Kenneth
Goodlad, Alastair
Mates, Michael


Banks, Robert
Gorst, John
Mather, Carol


Bell, Ronald
Gow, Ian (Eastbourne)
Maude, Angus


Bennett, Sir Frederic (Torbay)
Gower, Sir Raymond (Barry)
Maudling, Rt Hon Reginald


Bennett, Dr Reginald (Fareham)
Gray, Hamish
Mawby, Ray


Benyon, W.
Grieve, Percy
Mayhew, Patrick


Berry, Hon Anthony
Griffiths, Eldon
Meyer, Sir Anthony


Biffen, John
Grist, Ian
Miller, Hal (Bromsgrove)


Biggs-Davison, John
Grylls, Michael
Mills, Peter


Blaker, Peter
Hall, Sir John
Miscampbell, Norman


Body, Richard
Hall-Davis, A. G. F.
Mitchell, David (Basingstoke)


Boacawen, Hon Robert
Hamilton, Michael (Salisbury)
Monro, Hector


Bowden, A. (Brighton, Kemptown)
Hampson, Dr Keith
Moore, John (Croydon C)


Boyson, Dr Rhodes (Brent)
Hannam, John
Morgan, Geraint


Braine, Sir Bernard
Harrison, Col Sir Harwood (Eye)
Morgan-Giles, Rear-Admiral


Brittan, Leon
Harvie Anderson, Rt Hon Miss
Morris, Michael (Northampton S)


Brotherton, Michael
Hastings, Stephen
Morrison, Charles (Devizes)


Brown, Sir Edward (Bath)
Havers, Sir Michael
Morrison, Hon Peter (Chester)


Bryan, Sir Paul
Hawkins, Paul
Neave, Airey


Buchanan-Smith, Alick
Hayhoe, Barney
Nelson, Anthony


Buck, Antony
Heath, Rt Hon Edward
Neubert, Michael


Budgen, Nick
Heseltine, Michael
Newton, Tony


Bulmer, Esmond
Hicks, Robert
Normanton, Tom


Burden, F. A.
Higgins, Terence L.
Nott, John


Carlisle, Mark
Holland, Philip
Onslow, Cranley


Churchill, W. S.
Hordern, Peter
Osborn, John


Clark, Alan (Plymouth, Sutton)
Howe, Rt Hon Sir Geoffrey
Page, John (Harrow West)


Clark, William (Croydon S)
Howell, David (Guildford)
Page, Rt Hon R. Graham (Crosby)


Clarke, Kenneth (Rushcliffe)
Howell, Ralph (North Norfolk)
Pattie, Geoffrey


Clegg, Walter
Hurd, Douglas
Percival, Ian


Cockcroft, John
Hutchison, Michael Clark
Peyton, Rt Hon John


Cope, John
Irvine, Bryant Godman (Rye)
Pink, R. Bonner


Cormack, Patrick
Irving, Charles (Cheltenham)
Prior, Rt Hon James


Corrie, John
James, David
Raison, Timothy


Costain, A. P.
Jenkin, Rt Hon P. (Wanst'd&amp;W'df'd)
Rathbone, Tim


Critchley, Julian
Jessel, Toby
Rawlinson, Rt Hon Sir Peter


Crouch, David
Johnson Smith, G. (E Grinstead)
Rees, Peter (Dover &amp; Deal)


Crowder, F. P.
Jones, Arthur (Daventry)
Rees-Davies, W. R.


Davies, Rt Hon J. (Knutsford)
Jopling, Michael
Renton, Rt Hon Sir D. (Hunts)


Dean, Paul (N Somerset)
Joseph, Rt Hon Sir Keith
Renton, Tim (Mid-Sussex)


Dodsworth, Geoffrey
Kaberry, Sir Donald
Rhys Williams, Sir Brandon


Douglas-Hamilton, Lord James
Kellett-Bowman, Mrs Elaine
Ridley, Hon Nicholas


Drayson, Burnaby
Kershaw, Anthony
Ridsdale, Julian


du Cann, Rt Hon Edward
Kimball, Marcus
Rifkind, Malcolm


Durant, Tony
King, Evelyn (South Dorset)
Rippon, Rt Hon Geoffrey


Dykes, Hugh
King, Tom (Bridgwater)
Roberts, Michael (Cardiff NW)


Eden, Rt Hon Sir John
Kirk, Peter
Roberts, Wyn (Conway)


Edwards, Nicholas (Pembroke)
Kitson, Sir Timothy
Rodgers, Sir John (Sevenoaks)


Emery, Peter
Knight, Mrs Jill
Rossi, Hugh (Hornsey)


Eyre, Reginald
Knox, David
Ross, William (Londonderry)


Fairbairn, Nicholas
Lamont, Norman
Royle, Sir Anthony


Fairgrieve, Russell
Lane, David
Sainsbury, Tim


Farr, John
Langford-Holt, Sir John
St. John-Stevas, Norman


Fell, Anthony
Latham, Michael (Melton)
Scott, Nicholas


Finsberg, Geoffrey
Lawrence, Ivan
Scott-Hopkins, James


Fisher, Sir Nigel
Lawson, Nigel
Shaw, Giles (Pudsey)


Fletcher, Alex (Edinburgh N)
Le Merchant, Spencer
Shaw, Michael (Scarborough)


Fletcher-Cooke, Charles
Lester, Jim (Beeston)
Shelton, William (Streatham)


Fookes, Miss Janet
Lewis, Kenneth (Rutland)
Shepherd, Colin


Fowler, Norman (Sutton C'f'd)
Lloyd, Ian
Shersby, Michael


Fox, Marcus
Loveridge, John
Sims, Roger


Fraser, Rt Hon H. (Stafford &amp; St)
McAdden, Sir Stephen
Sinclair, Sir George


Fry, Peter
McCrindle, Robert
Skeet, T. H. H.




Smith, Dudley (Warwick)
Tebbit, Norman
Warren, Kenneth


Speed, Keith
Temple-Morris, Peter
Weatherill, Bernard


Spence, John
Townsend, Cyril D.
Wells, John


Sproat, Iain
Trotter, Neville
Whitelaw, Rt Hon William


Stainton, Keith
Tugendhat, Christopher
Wiggin, Jerry


Stanbrook, Ivor
van Straubenzee, W. R.
Winterton, Nicholas


Stanley, John
Vaughan, Dr Gerard
Wood, Rt Hon Richard


Steen, Anthony (Wavertree)
Viggers, Peter
Young, Sir G. (Ealing, Acton)


Stewart, Ian (Hitchin)
Wakeham, John
Younger, Hon George


Stokes, John
Walker, Rt Hon P. (Worcest[...])



Stradling Thomas, J.
Walker-Smith, Rt Hon Sir Derek
TELLERS FOR THE AYES:


Tapsell, Peter
Wall, Patrick
Mr. Richard Luce and


Taylor, R. (Croydon NW)
Walters, Dennis
Mr. Cecil Parkinson.


Taylor, Teddy (Cathcart)






NOES


Anderson, Donald
Dunnett, Jack
Jones, Barry (East Flint)


Archer, Peter
Dunwoody, Mrs Gwyneth
Jones, Dan (Burnley)


Armstrong, Ernest
Eadie, Alex
Judd, Frank


Ashley, Jack
Edge, Geoff
Kaufman, Geraid


Ashton, Joe
Edwards, Robert (Wolv SE)
Kelley, Richard


Atkins, Ronald (Preston N)
Ellis, John (Brigg &amp; Scun)
Kerr, Russell


Atkinson, Norman
Ellis, Tom (Wrexham)
Kilroy-Silk, Robert


Bagier, Gordon A. T.
English, Michael
Kinnock, Neil


Barnett, Guy (Greenwich)
Evans, Fred (Caerphilly)
Lambie, David


Barnett, Rt Hon Joel (Heywood)
Evans, Gwynfor (Carmarthen)
Lamborn, Harry


Bates, Alf
Evans, Ioan (Aberdare)
Lamond, James


Bean, R. E.
Evans, John (Newton)
Leadbitter, Ted


Beith, A. J.
Ewing, Harry (Stirling)
Lee, John


Benn, Rt Hon Anthony Wedgwood
Faulds, Andrew
Lestor, Miss Joan (Eton &amp; Slough)


Bennett, Andrew (Stockport N)
Fernyhough, Rt Hon E.
Lever, Rt Hon Harold


Bidwell, Sydney
Fitch, Alan (Wigan)
Lewis, Arthur (Newham N)


Bishop, E. S.
Flannery, Martin
Lipton, Marcus


Blenkinsop, Arthur
Fletcher, Raymond (Ilkeston)
Litterick, Tom


Boardman, H.
Fletcher, Ted (Darlington)
Loyden, Eddie


Booth, Albert
Ford, Ben
Luard, Evan


Boothroyd, Miss Betty
Forrester, John
Lyon, Alexander (York)


Bottomley, Rt Hon Arthur
Fowler, Gerald (The Wrekin)
Lyons, Edward (Bradford W)


Boyden, James (Bish Auck)
Fraser, John (Lambeth, N'w'd)
Mabon, Dr J. Dickson


Bray, Dr Jeremy
Freeson, Reginald
McElhone, Frank


Broughton, Sir Alfred
Freud, Clement
MacFarquhar, Roderick


Brown, Hugh D. (Provan)
Garrett, John (Norwich S)
McGuire, Michael (Ince)


Brown, Robert C. (Newcastle W)
Garrett, W. E. (Wallsend)
Mackenzie, Gregor


Buchan, Norman
Gilbert, Dr. John
Mackintosh, John P.


Buchanan, Richard
Ginsburg, David
Maclennan, Robert


Butler, Mrs Joyce (Wood Green)
Golding, John
McMillan, Tom (Glasgow C)


Callaghan, Jim (Middleton &amp; P)
Gould, Bryan
McNamara, Kevin


Campbell, Ian
Graham, Ted
Madden, Max


Canavan, Dennis
Grant, George (Morpeth)
Magee, Bryan


Cant, R. B.
Grant, John (Islington C)
Mahon, Simon


Carmichael, Neil
Grocott, Bruce
Marquand, David


Carter, Ray
Hamilton, James (Bothwell)
Marshall, Dr Edmund (Goole)


Cartwright, John
Hamilton, W. W. (Central Fife)
Marshall, Jim (Leicester S)


Castle, Rt Hon Barbara
Hardy, Peter
Mason, Rt Hon Roy


Clemitson, Ivor
Harper, Joseph
Maynard, Miss Joan


Cocks, Michael (Bristol S)
Harrison, Walter (Wakefield)
Meacher, Michael


Cohen, Stanley
Hart, Rt Hon Judith
Mellish, Rt Hon Robert


Colquhoun, Mrs Maureen
Hatton, Frank
Mendelson, John


Concannon, J. D.
Hayman, Mrs Helene
Millan, Bruce


Cook, Robin F. (Edin C)
Healey, Rt Hon Denis
Miller, Dr M. S. (E Kilbride)


Corbett, Robin
Heffer, Eric S.
Miller, Mrs Millie (Ilford N)


Craigen, J. M. (Maryhill)
Hooley, Frank
Mitchell, R. C. (Solon, Itchen)


Cronin, John
Horam, John
Moonman, Eric


Crosland, Rt Hon Anthony
Howell, Denis (B'ham, Sm H)
Morris, Alfred (Wythenshawe)


Cryer, Bob
Howells, Geraint (Cardigan)
Morris, Charles R. (Openshaw)


Cunningham, G. (Islington S)
Hoyle, Doug (Nelson)
Moyle, Roland


Cunningham, Dr J. (Whiteh)
Huckfield, Les
Mulley, Rt Hon Frederick


Davidson, Arthur
Hughes, Rt Hon C. (Anglesey)
Murray, Rt Hon Ronald King


Davies, Bryan (Enfield N)
Hughes, Robert (Aberdeen N)
Newens, Stanley


Davies, Denzil (Llanelli)
Hughes, Roy (Newport)
Noble, Mike


Davies, Ifor (Gower)
Hunter, Adam
Oakes, Gordon


Davis, Clinton (Hackney C)
Irvine, Rt Hon Sir A. (Edge Hill)
Ogden, Eric


Deakins, Eric
Irving, Rt Hon S. (Dartford)
O'Halloran, Michael


Dean, Joseph (Leeds West)
Jackson, Colin (Brighouse)
O'Malley, Rt Hon Brian


de Freitas, Rt Hon Sir Geoffrey
Janner, Greville
Orbach, Maurice


Delargy, Hugh
Jay, Rt Hon Douglas
Ovenden, John


Dell, Rt Hon Edmund
Jeger, Mrs Lena
Owen, Dr David


Dempsey, James
Jenkins, Hugh (Putney)
Padley, Walter


Doig, Peter
Jenkins, Rt Hon Roy (Stechford)
Palmer, Arthur


Dormand, J. D.
John, Brynmor
Pardoe, John


Douglas-Mann, Bruce
Johnson, James (Hull West)
Park, George


Duffy, A. E. P.
Johnson, Walter (Derby S)
Parker, John


Dunn, James A.
Jones, Alec (Rhondda)
Parry, Robert







Peart, Rt Hon Fred
Silkin, Rt Hon John (Deptford)
Torney, Tom


Penhaligon, David
Silkin, Rt Hon S. C. (Dulwich)
Urwin, T. W.


Perry, Ernest
Sillars, James
Wainwright, Edwin (Dearne V)


Phipps, Dr Colin
Silverman, Julius
Walden, Brian (B'ham, L'dy w'd)


Prescott, John
Skinner, Dennis
Walker, Harold (Doncaster)


Price, C. (Lewisham W)
Small, William
Walker, Terry (Kingswood)


Price, William (Rugby)
Smith, John (N Lanarkshire)
Ward, Michael


Radice, Giles
Snape, Peter
Watkins, David


Richardson, Miss Jo
Spearing, Nigel
Watkinson, John


Roberts, Albert (Normanton)
Spriggs, Leslie
Weetch, Ken


Roberts, Gwilym (Cannock)
Stallard, A. W.
Weitzman, David


Robertson, John (Paisley)
Steel, David (Roxburgh)
Wellbeloved, James


Roderick, Caerwyn
Stewart, Rt Hon M. (Fulham)
White, James (Pollok)


Rodgers, George (Chorley)
Stoddart, David
Whitehead, Phillip


Rodgers, William (Stockton)
Stott, Roger
Whitlock, William


Rooker, J. W.
Strang, Gavin
Wigley, Dafydd


Roper, John
Strauss, Rt Hon G R.
Willey, Rt Hon Frederick


Rose, Paul B.
Summerskill, Hon [...] Shirley
Williams, Alan (Swansea W)


Ross, Rt Hon W. (Kilmarnock)
Swain, Thomas
Williams, Rt Hon Shirley (Hertford)


Ryman, John
Taylor, Mrs Ann (Bolton W)
Williams, W. T. (Warrington)


Sandelson, Neville
Thomas, Jeffrey (Abertillery)
Wilson, Alexander (Hamilton)


Sedgemore, Brian
Thomas, Mike (Newcastle E)
Woodall, Alec


Selby, Harry
Thomas, Ron (Bristol NW)
Woof, Robert


Shaw, Arnold (Ilford South)
Thorne, Stan (Preston South)



Sheldon, Robert (Ashton-u-Lyne)
Tierney, Sydney
TELLERS FOR THE NOES:


Shore, Rt Hon Peter
Tomlinson, John
Miss Margaret Jackson and


Short, Rt Hon E. (Newcastle C)
Tomney, Frank
Mr. Laurie Pavitt.

Question accordingly negatived.

Orders of the Day — BUSINESS OF THE HOUSE

Ordered,

That the consideration of Lords Amendments to the Prices Bill and the Malta Republic Bill [Lords] may be proceeded with at this day's sitting though opposed, until any hour.—[Mr. Walter Harrison.]

Orders of the Day — PRICES BILL

Lords amendments considered.

Clause 2

REGULATION OF PRICE OF FOOD ETC.

Lords Amendment: No. 1, in page 3, line 9, after "above" insert:
otherwise than in retail shops with a selling space of less than 250 sq. ft.

10.15 p.m.

The Under-Secretary of State for Prices and Consumer Protection (Mr. Robert Maclennan): I beg to move, That this House doth disagree with the Lords in the said amendment.

Mr. Speaker: Order. Will those hon. Members who wish to conduct conversations do so outside the Chamber.

Mr. Maclennan: If it would be for the convenience of the House, it might be suitable if at the same time we considered Lords Amendment No. 2, in line 15 at end insert:
( ) in subsection (4) after paragraph (c) there shall be inserted the following new paragraph—
'(d) the provisions of this subsection shall not apply to retail shops with a selling space of less than 250 sq. ft.';
I very much sympathise with the view that regulations affecting small shopkeepers should take fully into account their often limited resources. Indeed, the purpose of Clause 2(1)(a) of the Bill is to enable an order to be made allowing the full list of maximum prices simply to be kept available on demand rather than displayed in the shop. This modification of the Prices Act 1974 was introduced in part to help proprietors of small shops with little space to spare and many demands on their time.
The House has considered the issues raised by these amendments very carefully during the passage of the Bill. I believe that no one now seriously disputes that if large sums of public money are to be spent on subsidising essential foodstuffs, it is only right to make such regulations as are necessary to ensure that the full benefit is passed on to the consumer. However, perhaps it is necessary to restate the reason why, in addition

to statutory maximum prices, a control on profit margins is needed.
It would certainly make the task to enforcement easier to rely on maximum prices only, but in setting the level of maximum prices, including the area prices fixed for bread, we had special regard for the needs of the small shopkeeper with high costs and low turnover. That is why the maximum prices are generally some way above the prices which most shoppers in urban areas have to pay. Without margin control there would be nothing except competition to prevent those selling at lower prices from raising their prices towards the maximum and thus absorbing part of the subsidy.
I believe that it is well recognised that competition is not always necessarily strong—for example, in rural areas, where there may be only one shop, which could well have a selling space of less than 250 sq. ft.
If instead—and contrary, incidentally, to the expressed wish of the trade—we were to rely on maximum prices only and these were consequently set much lower, at, say, something like the national average, the small shop would be the first to suffer. I am sure, therefore, that it will be agreed that gross profit margins should not be higher in percentage terms than they were before the subsidy was proposed. Only by control of gross percentage margins can we ensure that the full amount of the subsidy is reaching the consumer, and that the wishes of the House in giving effect to our subsidy programme are being properly met. If it is right to have gross percentage margin control for one shop, I believe it is right to have it for all shops.
The number of shops under 250 sq. ft. is undoubtedly large, even though their turnover individually may be small. Their prices may be higher than those of the large supermarkets but in some cases —I believe in quite a substantial number —they are well below the maximum prices set. A number of these small shops, for example, are no doubt members of the voluntary groups and so get the benefit of bulk purchasing. I think it wrong to deny the customers of these small shops, particularly the old and under-privileged who have to use them and cannot perhaps travel to larger shopping centres, the protection which is


afforded by this legislation to customers of larger shops.
Moreover, it does not seem reasonable to exclude these smaller shops from the requirement to keep records needed to enable the control to be efficiently exercised and enforced. What we shall ensure in introducing the requisite orders under this clause is that only the minimum of records, adapted as closely as possible to the existing record-keeping practices of the trade, should be required from any retailer. In preparing the orders I undertake that we shall consider most carefully the particular difficulties of small shopkeepers. We shall, of course, follow the normal procedures of consultation which have been established with representatives of the trade—which the Bill extends to record-keeping orders. We shall carry out these consultations thoroughly before making any order. As I indicated in Committee, any record-keeping requirement would not operate retrospectively and a new reference period would in due course be set.
It is not in dispute that small shops should he subject to the maximum prices laid down for subsidised foods. It follows that the shopkeeper himself will need to know those maximum prices. It is only right that his customers, no less than the customers of large shops, should be able to see what those prices are. This is not a very onerous requirement, particularly as we have made provision that it shall be fulfilled with the maximum degree of informality. The notice can be handwritten and the display is to be required for only a small number of best-selling items.
I hope the House will recognise that it would not be reasonable to exempt one class of shop from measures designed to ensure that the full benefits of subsidy expenditure are passed on to the customer.

Mr. Norman Lamont: Like the Minister, I shall not detain the House long as this ground was gone over in depth in Committee. However, we are a little disappointed that the hon. Gentleman should have come back, after these amendments have been made in the Lords, and given such brief consideration to the compelling arguments put forward both in Committee and in the Lords. We have grave reser-

vations about the wisdom of reinstating the provision that the Lords deleted.
As the Minister said, the purpose of the amendments is twofold: to give small shops some exemption, first, regarding the display of notices and, secondly, regarding the keeping of records for margin control on subsidised products.
The hon. Gentleman will recall that this matter was debated in Committee. We put down an amendment to try to achieve these two specific objectives. At that time the Minister's objection was that the amendment was framed in such a way that it effectively removed price control altogether. The Lords have made an amendment which not only meets the objectives that we had in mind, but does not sweep away price control in its entirety.
Having studied the debates in the other place, we know some of the Government's objections to the amendments. The first, which the Minister repeated tonight, is that if we deny the obligation on small shopkeepers to keep records, it will mean substituting an inflexible form of control for a flexible one; that is that control will rest on the maximum price mechanism rather than on margin control. We would not object to that, because the maximum prices seem sufficient for controlling the small shopkeepers, particularly as their prices are often closer to the maximum. They tend to have higher costs, higher margins and, in general, higher prices.
These amendments are designed to help the very small shopkeeper. We are talking here about shops of less than 250 sq. ft.—which is very small. We believe that many of these people have recently been overwhelmed by pettifogging and petty-minded bureaucracy. They have had to bear the burden of increased national insurance contributions and of acting as the Government's agent in administering beef and butter tokens. They have had to face the added burden of rates. We believe that if we could relieve them of some of the administrative burden that has been imposed upon them under the prices legislation it would give them some welcome relief.
It is common ground between the two sides of the House that the small shopkeeper has a special role to play in many communities. It is true that his


prices are often a bit higher, and that often his margins have to be higher because he has a lower turnover, but in many cases he contributes to a sense of community. Although many people have their main shopping expedition at the weekend at a supermarket, the local shop serves a particular function for during-the-week shopping and for popping in for items which have been forgotten at the weekend. Also, for many elderly people the local shop is the main outlet for buying their weekly food requirements. They are on friendly terms with the local shopkeeper, and in that situation it is unlikely that one will find overcharging or subsidised products being sold at excessive prices.
We believe that the people at whom the amendment is aimed have been overwhelmed by the red tapists' paradise which the Government have been creating. There is an obligation to display or to keep notices of maximum national prices, maximum prices in particular shops, price range notices, notices of the most popular brands, and, on top of that, records for margin control purposes.
We have come a long way since the bread order. If the other orders relating to subsidised foods had followed the model of the bread order we should have reached the situation in which about 200 notices would have had to be displayed in a small shop. Fortunately, the Government retreated somewhat from that position, and we are urging that, having retreated a little, they should go further and recognise that there is no sense in maintaining the obligation to keep records and display notices in these very small shops.
The Government have made one concession, which we welcome. We welcome the fact that many of these notices need not actually be displayed but can be kept in the shop. But that does not relieve the shopkeeper from the burden of having to make the calculations that have to be put into the notices. The maximum prices under various orders are constantly altered. The maximum price of bread is about to be altered for the third time, and there are various kinds of bread for which the adjustments have to be made. The butter order has been amended twice, and there are no fewer

than 26 varieties of cheese for which separate records have to be kept and separate prices have to be listed.
Since the debates in Committee we have had one development, and that is that the tea order has been laid before the House. It would need a lawyer to understand the tangled web of provisions under that order. I do not want tonight to go into its provisions—to do so would be out of order in this debate—but they are exceedingly complicated and they illustrate the burden that will fall upon the small shopkeeper trying to understand whether the goods that he is selling conform with it.
10.30 p.m.
I urge the Minister again, having made the concessions that he has, to go a little further. Now that a number of these notices can be kept in drawers, behind the sugar and under the dog and need not be displayed permanently, is it so necessary to continue with all these regulations? If a maximum price was displayed in a small shop, I wonder how many people would know whether it was correct. I suspect that only the enforcement officer would know. I wonder how many people, in front of all the other customers, will ask the small shopkeeper to open the drawer and show them the notices stuffed there. This does not serve much purpose at all.
A further point which has not been answered before is that the maximum prices specified on these notices often bear no relation to what is being sold in the shop. In fact, prices might be stipulated in some notices which would be illegal under other parts of the prices legislation. Some of the notices seem to have no relevance to what is sold or is likely to be sold.
The Minister cast a little doubt on the forces of competition in this area, but if these regulations are to be enforced on the larger trader—if he is to be compelled to have these notices and this margin control—it is unlikely that the smaller shop will charge much higher prices. If the regulations are actually biting on the larger shop the market will look after the prices charged by the smaller shop. In these small shops, where there is a close relationship between the customer and the shopkeeper, it is unlikely that the fiddling of customers that the Minister fears will occur.
Alas, because of regulations under successive Governments, small shops have been facing increasing pressures. In a number of respects, the number of shops offering services has diminished sharply over the last 10 years. In that time, a third of our newsagents, grocers and tobacconists and a quarter of our greengrocers, fishmongers and chemists have disappeared. There has been a dramatic rate of closure among small shoe repairers. Many of the people who operate these small businesses are close to despair at the burden being placed on them. They wonder whether it is worth all the effort, overtime and enterprise that they put into running efficient businesses. Beadledom and bumbledom will now be revealed in all their glory administering this tangled web of regulations.
The amendments will not go far, but at least they will remove some of the administrative burden on small shopkeepers. For that reason, we shall support the Lords amendments.

Mr. John Pardoe: I represent a rural area in which there are still, although I dare say not for much longer, a large number of small village shops, many of which would come into the category defined in the amendments. I do not expect many of them to be there in my grandchildren's time if the present decimation of rural services and industries goes on.
However, I accept immediately the logic of the Government's argument: once we have price controls and subsidies, it is only right and proper that the controls should try to ensure that public money is not misspent and misused. Taking subsidies for granted, although I have opposed them, we have to have these regulations over the whole panoply of shops. This spectre of bureaucracy and red tape for these very small shops is a crippling burden for people who find it increasingly difficult to master the bureaucratic necessities of modern life and the running of a small business.
I have been unable to find out from the debates in another place with how many small shops through which subsidies may leak we are dealing. How many are there and how many are concerned with subsidies? What proportion of the total of subsidies is likely to go through them? I suspect that it is a very small amount.
We are adding not to the Government's administrative costs, but to the compliance costs of shopkeepers—unnecessarily, I suspect, because even if the amount of subsidy in each shop were to leak out, I dare say that would be a very small amount of public money. We have to balance the advantages of saving a small amount of public money against the inconvenience.

Mr. Giles Shaw: When we discussed this matter in Committee, some of us were concerned to press the Government to omit the implications of the maximum price orders and display notices for small shops. When we saw the concession that would offer either display of the notice or the keeping of records for reference, we felt we had gone some way in demonstrating the rightness of the moral argument.
It is absurd that we should be considering whether this information is useful to the public and whether it should be displayed or kept in a drawer. It is either useful and important information or it is not. As Government agree that it may be displayed or kept in a drawer, we must ask what is the object of having the information circulated to the smallest shopkeeper.
If it is not available to the consumer looking around and she has to ask for it, it can hardly be a particularly important piece of information in the retail situation, and this is the contention behind the Lords amendments which we wish to support. It is that, at this level of trading, the kind of information required to be kept is frankly useless to the consumer and the shopkeeper. Its utility is in direct relation to its accuracy and it will have to be kept up to date at increasing speed in view of the way in which food prices are now moving.
It would have to be used by the small shopkeeper in an intelligent and regular fashion and, with the best will in the world, I do not believe that the House could expect the lower end of the distributive trade to keep pace with what is required to utilise the information. The only possible use for it must be in the possible checks that may be imposed by the fair trading officers operating on behalf of the Department. As taxpayers, we would not wish them to be calling on the smallest outlets where the least trade is done in subsidised food. They should


concentrate on maximum outlets where the greatest throughput is involved and where maximum prices for subsidised foods are of great importance.
I remind the Minister of the Price Commission's report on profits in the distributive trade. Paragraph 2.4 says:
Profit margins within the control remain at a very depressed level. For Category 1 manufacturing and service companies, net profit margins in the fourth quarter 1974 were 50·2 per cent. of reference levels compared with 52·4 per cent. in the third quarter. A year earlier (fourth quarter 1973) they had been 71·4 per cent. For Category II manufacturing and service companies, the fourth quarter figure was 57·8 per cent. compared with 54·3 per cent. in the previous quarter and 65·0 per cent. a year earlier.
For distributors, there has been an a apparent sizeable recovery but this is largely illusory. In the fourth quarter 1974, net profit margins were 75·3 per cent. of reference levels compared with 58·8 per cent. in the third quarter. But the fourth quarter figures reflect the peak Christmas trading when profits are seasonally high. The 75·3 per cent. for the fourth quarter 1974 compares with 94·5 per cent. for the corresponding quarter of 1973. While the fourth quarter shows some improvement from the very depressed levels of the third quarter, the general level of profitability, seasonally-adjusted, is still very low.
It is paramount in distribution, where operating margins are continually being squeezed against costs, that we should recognise that, although the position is bad for the larger distributors covered by the report, it is even worse for smaller shops. We all know the administrative burdens and the costs that the small shops have to hear and their lack of opportunity to develop turnover.
I hope that the Minister will accept our view even at this late stage. If the information may be kept instead of being displayed, it cannot be all that useful, certainly not to the consumer, and it would not be worth while for the fair trading officer and the local authority officer to check on the smallest shops.
The buck having to rest on the smallest shop, which is a back not big enough to carry it, and following the trends against the small shops and the competition of pricing from the supermarkets and larger stores, there is sound reason for believing that maximum pricing, even in the smallest shops, would seldom be exceeded.

Mr. Maclennan: The hon. Member for Kingston-up-Thames (Mr. Lamont) stated

on behalf of the Opposition that there was no objection to maximum price control in place of margin control. That was an honest admission of the difficulties of the Opposition in dealing with the powers involved in the Prices Act. That is in line with the views that the trade has expressed to us from the beginning—that cash margin control is not acceptable because of the rigidity that it would place upon the trade, and to move from a percentage margin control to a cash margin control, which I take to be the logic of what the Opposition are suggesting, would be quite unacceptable and for that reason not a line that the present Government would be likely to take.
The hon. Member has rightly emphasised that both sides of the House recognise the importance of the small shop in providing for the needs of the communities dependent upon them, particularly the less advantaged who are immobile and who regularly use the corner shop or the village shop because they cannot get to the larger shop. But that recognition has a certain logic that the Opposition have not been prepared to follow through, namely, that those who are dependent upon the corner shop must be protected from abuse. If Parliament votes substantial sums of money for food subsidies, it is right that those who use the small shoo should benefit as do those who use the larger shops.
The hon. Member for Cornwall, North (Mr. Pardoe) said that the amount involved might be very small because the number of outlets might be very small. There is no authoritative indication of exactly how many shops of this size there are, but that they probably run into thousands is certainly clear. Although their total number is large and their turnover fairly small, they are of key importance in servicing the needs of some people, particulaly those living in rural communities, as the hon. Member will be aware. We must protect people living in such communities just as much as people living in reach of the larger multiples.
I cannot accept his view that what we propose will place a crippling burden on the small shopkeeper. Both the hon. Member for Cornwall, North and the hon. Member for Pudsey (Mr. Shaw) made this point and it has been made in earlier debates. Although much has been made of these difficulties, it may be a measure


of the trade's lack of interest that we have not received one representation on behalf of traders, large or small, about these proposed new powers. This must stem from the fact that from the beginning we have displayed a complete willingness to adapt our requirements to the needs of particular sections of the trade. When we bring forward orders we shall continue the practice of close consultation to ensure that difficulties such as have been apprehended are not realised.

10.45 p.m.

Mr. Gwilym Roberts: Does my hon. Friend agree that one reason for the lack of representations from the trade is that it is probably in the interests of the small businessman to be brought into line with the supermarket? The small shop depends upon good will, and it is therefore essential that the customer should feel that he is getting in the small shop whatever the supermarket provides.

Mr. Maclennan: My hon. Friend has a valid point. There are advantages in the small shop keeper being able to announce to his customers that the benefits of the subsidies are being passed on. The hon. Member for Pudsey succeeded, according to his lights, in persuading the Government of the desirability of making certain changes in the law, particularly in respect of the requirement for information to be kept, not on display but available in the shop. He says that this is not important. I disagree. We made that change in the Bill to ensure that the small shopkeeper would not find his shelf space cluttered up with a lot of information. It seems a sensible change.
That is not to say that the shopper who uses the small shop should not be entitled to ask for information which the shopkeeper must have if he is to satisfy the legal requirement that he charges no more than the maximum price. All we say is that this information should be available to the shopper.
I hope hon. Members will accept that the purpose of these proposals is to ensure that the public funds involved are properly applied in a non-discriminatory way to all shoppers, regardless of the type of shop they use. They are a protection for those such as the disadvantaged and the immobilised who rely upon the special services of the small shop.

Mr. Michael Neubert: We have had a short debate and I must be careful to ensure that my speech does not greatly add to its length.
We have concentrated in earlier debates, quite rightly, upon the food subsidies themselves, staggering sums, an expenditure which we believe wasteful and largely indiscriminate. Here we are considering the unseen costs of the subsidies, the extensive apparatus of control, the demands on the unpaid time of shopkeepers and the unquantified expense of enforcement to local government, already suffering from the many duties transferred to it from the Government. To that extent we must agree with the Lords amendment. As my hon. Friend the Member for Kingston-upon-Thames (Mr. Lamont) said, these shops are an important part of our national life, providing a service to people in small communities, not only in the country but in those parts of our larger towns and cities that are old-fashioned and off-centre.
The owners of small shops work long hours, weekdays and weekends. They rarely take holidays, and are prepared to provide a wide range of articles in penny numbers. We ask for some special consideration for them. This legislation makes no distinction between the corner shop and the hypermarket. It is clear that orders will be introduced, and the Secretary of State has promised one that will make two small concessions to the small shopkeeper. First, he would not have to display the price range of non-subsidised foods. In the case of subsidised foods, the price range displayed would start at a higher price. The last is, presumably, a statutory figleaf to cover the fact that there are lower prices available in the larger supermarkets elsewhere.
The Government should go further—first, by exempting the smaller shopkeepers from the necessity to comply with this requirement of records which, far from being the free give-away indispensable tool of management it has been claimed to be, will turn out to be yet another unpaid job at the end of a weary day, and, secondly, by relieving small shopkeepers from the necessity of displaying all these official notices so reminiscent of the Second World War and the blitz, needing only the Fougasse poster "Careless talk costs lives" to be completely in period.
In case hon. Members should think that there is not some sign of concession, I should indicate that there is a breach in the 100 per cent. principle. Is it fair that these small shopkeepers should suffer these irksome chores merely so that civil servants should not turn uneasily at night at the thought of being arraigned before the Public Accounts Committee? The Under-Secretary of State, in the debate on the Butter (Prices) Order, pointed out that the Government
have not required the display provisions to be applied to mobile shops, such as milk floats and the vans of grocery roundsmen.
Is the public's money not just as much at stake when the shops are mobile as when they are stationary? Is the little old lady who cannot walk down to the local shop to be at the mercy of her friendly van driver? Is not the house-wife to be protected from her milkman? The breach is already made. Emboldened, we go in hot pursuit for further exemption for the small shopkeeper.
There are other helpful passages from the same speech. The Under-Secretary said that maximum prices
are intended to be those at which the reason-ably efficient small shopkeeper can continue to supply butter.
It therefore follows that only the unreasonably efficient small shopkeeper is

likely to be able to sell at less than that price. There is no question of reducing the maximum price.

The Under-Secretary reinforced the point in these words:
the small corner shops that will find themselves most effectively controlled by the maximum price regulation of the order."—[Official Report, 13th January 1975 Vol. 884, cc. 134-38.]

That was a point which was made by my hon. Friend the Member for Pudsey (Mr. Shaw).

If small corner shops are so completely controlled by the maximum price regulation, why not leave it at that? We all know that we do the British public no service by burdening them with unnecessary legislation. If from this small debate we can bring some small relief, as the hon. Member for Cornwall, North (Mr. Pardoe) said, to the small shopkeeper—a member of a small, hard-working. hard-pressed, moderately-paid section of the community—it will have been parliamentary time well spent.

Question put, That this House cloth disagree with the Lords in the said amendment.

The House divided: Ayes 244. Noes 215.

Division No. 197.]
AYES
[10.55 p.m.


Anderson, Donald
Cocks, Michael (Bristol S)
Ewing, Harry (Stirling)


Archer, Peter
Cohen, Stanley
Faulds. Andrew


Armstrong, Ernest
Colquhoun, Mrs Maureen
Fernyhough, Rt Hon E.


Ashton, Joe
Concannon, J. D.
Fitch, Alan (Wigan)


Atkins, Ronald (Preston N)
Cook, Robin F. (Edin C)
Flannery, Martin


Atkinson, Norman
Corbett, Robin
Fletcher, Raymond (Ilkeston)


Bagier, Gordon A. T.
Craigen, J. M. (Maryhill)
Fletcher, Ted (Darlington)


Barnett, Guy (Greenwich)
Cronin, John
Ford, Ben


Barnett, Rt Hon Joel (Heywood)
Crosland, Rt Hon Anthony
Forrester, John


Bates, Alf
Cryer, Bob
Fowler, Gerald (The Wrekin)


Bean, R. E.
Cunningham, G. (Islington S)
Fraser, John (Lambeth. N'w'd)


Been, Rt Hon Anthony Wedgwood
Cunningham, Dr J. (Whiteh)
Freeson, Reginald


Bennett, Andrew (Stockport N)
Davidson, Arthur
Garrett, John (Norwich S)


Bishop, E. S.
Davies, Bryan (Enfield N)
Gilbert, Dr. John


Blenkinsop, Arthur
Davies, Denzil (Llanelli)
Ginsburg, David


Boardman, H.
Davies, Ifor (Gower)
Golding, John


Booth, Albert
Deakins, Eric
Gould, Bryan


Boothroyd, Miss Betty
Dean, Joseph (Leeds West)
Graham, Ted


Bottomley, Rt Hon Arthur
Delargy, Hugh
Grant, George (Morpeth)


Boyden, James (Bish Auck)
Dell, Rt Hon Edmund
Grant, John (Islington C)


Bray, Dr Jeremy
Dempsey, James
Grocott, Bruce


Brown, Hugh D. (Provan)
Doig, Peter
Hardy, Peter


Brown, Robert C. (Newcastle W)
Dormand, J. D.
Harper, Joseph


Buchan, Norman
Douglas-Mann, Bruce
Harrison, Walter (Wakefield)


Buchanan, Richard
Duffy, A. E. P.
Hart, Rt Hon Judith


Butler, Mrs Joyce (Wood Green)
Dunn, James A.
Hatton, Frank


Callaghan, Jim (Middleton &amp; P)
Dunnett, Jack
Hayman, Mrs Helene


Campbell, Ian
Dunwoody, Mrs Gwyneth
Heifer, Eric S.


Canavan, Dennis
Eadie, Alex
Hooley, Frank


Cant, R. B.
Edge, Geoff
Horam, John


Carmichael, N[...]il
Ellis, Tom (Wrexham)
Howell, Denis (B'ham, Sm H)


Carter, Ray
English, Michael
Hoyle, Doug (Nelson)


Cartwright, John
Evans, Gwynfor (Carmarthen)
Hughes, Rt Hon C. (Anglesey)


Castle, Rt Hon Barbara
Evans, Ioan (Aberdare)
Hughes, Robert (Aberdeen N)


Clemitson, Ivor
Evans, John (Newton)
Hunter, Adam




Irvine, Rt Hon Sir A. (Edge Hill)
Mellish, Rt Hon Robert
Small, William


Irving, Rt Hon S. (Dartford)
Millan, Bruce
Smith, John (N Lanarkshire)


Jackson, Colin (Brighouse)
Miller, Dr M. S. (E Kilbride)
Snape, Peter


Jackson, Miss Margaret (Lincoln)
Miller, Mrs Millie (Ilford N)
Spearing, Nigel


Janner, Greville
Mitchell, R. C. (Soton, Itchen)
Spriggs, Leslie


Jeger, Mrs Lena
Morris, Alfred (Wythenshawe)
Stallard, A. W.


Jenkins, Hugh (Putney)
Morris, Charles R. (Openshaw)
Stewart, Rt Hon M. (Fulham)


John, Brynmor
Mulley, Rt Hon Frederick
Stoddart, David


Johnson, James (Hull West)
Murray, Rt Hon Ronald King
Stott, Roger


Johnson, Walter (Derby S)
Newens, Stanley
Strang, Gavin


Jones, Alec (Rhondda)
Noble, Mike
Strauss, Rt Hon G. R.


Jones, Barry (East Flint)
Oakes, Gordon
Summerskill, Hon Dr Shirley


Jones, Dan (Burnley)
O'Halloran, Michael
Swain, Thomas


Judd, Frank
O'Malley, Rt Hon Brian
Taylor, Mrs Ann (Bolton W)


Kaufman, Gerald
Orbach, Maurice
Thomas, Jeffrey (Abertillery)


Kelley, Richard
Ovenden, John
Thomas, Mike (Newcastle E)


Kerr, Russell
Owen, Dr David
Thomas, Ron (Bristol NW)


Kinnock, Neil
Palmer, Arthur
Thorne, Stan (Preston South)


Lambie, David
Parker, John
Tierney, Sydney


Lamborn, Harry
Parry, Robert
Tomlinson, John


Lamond, James
Pavitt, Laurie
Tomney, Frank


Leadbitter, Ted
Peart, Rt Hon Fred
Torney, Tom


Lee, John
Perry, Ernest
Urwin, T. W.


Lestor, Miss Joan (Eton &amp; Slough)
Phipps, Dr Colin
Wainwright, Edwin (Dearne V)


Lewis, Arthur (Newham N)
Prescott, John
Walden, Brian (B'ham, L'dyw'd)


Lipton, Marcus
Price, C. (Lewisham W)
Walker, Harold (Doncaster)


Litterick, Tom
Price, William (Rugby)
Walker, Terry (Kingswood)


Loyden, Eddie
Radice, Giles
Ward, Michael


Luard, Evan
Richardson, Miss Jo
Watkins, David


Lyons, Edward (Bradford W)
Roberts, Albert (Normanton)
Watkinson, John


Mabon, Dr J. Dickson
Roberts, Gwilym (Cannock)
Weetch, Ken


McElhone, Frank
Robertson, John (Paisley)
Weitzman, David


MacFarquhar, Roderick
Roderick, Caerwyn
Wellbeloved, James


McGuire, Michael (Ince)
Rodgers, George (Chorley)
White, James (Pollok)


Mackenzie, Gregor
Rodgers, William (Stockton)
Whitehead, Phillip


Mackintosh, John P.
Rooker, J. W.
Whitlock, William


Maclennan, Robert
Roper, John
Wigley, Dafydd


McMillan, Tom (Glasgow C)
Rose, Paul B.
Williams, Alan (Swansea W)


McNamara, Kevin
Ross, Rt Hon W. (Kilmarnock)
Williams, Rt Hon Shirley (Hertford)


Madden, Max
Ryman, John
Williams, W. T. (Warrington)


Magee, Bryan
Selby, Harry
Wilson, Alexander (Hamilton)


Mahon, Simon
Shaw, Arnold (Ilford South)
Woodall, Alec


Marquand, David
Sheldon, Robert (Ashton-u-Lyne)
Woof, Robert


Marshall, Dr Edmund (Goole)
Short, Rt Hon E. (Newcastle C)



Marshall, Jim (Leicester S)
Silkin, Rt Hon John (Deptford)
TELLLERS FOR THE AYES


Mason, Rt Hon Roy
Silkin, Rt Hon S. C. (Dulwich)
Mr. John Ellis and


Maynard, Miss Joan
Silverman, Julius
Mr. James Hamilton.


Meacher, Michael
Skinner, Dennis





NOES


Adley, Robert
Davies, Rt Hon J. (Knutslord)
Hall, Sir John


Aitken, Jonathan
Dean, Paul (N Somerset)
Hall-Davis, A. G. F.


Alison, Michael
Dodsworth, Geoffrey
Hamilton, Michael (Salisbury)


Amery, Rt Hon Julian
Douglas-Hamilton, Lord James
Hampson, Dr Keith


Arnold, Tom
Drayson, Burnaby
Hannam, John


Atkins, Rt Hon H. (Spelthorne)
du Cann, Rt Hon Edward
Harrison, Col Sir Harwood (Eye)


Awdry, Daniel
Durant, Tony
Harvie Anderson, Rt Hon Miss


Baker, Kenneth
Dykes, Hugh
Hastings, Stephen


Banks, Robert
Eden, Rt Hon Sir John
Havers, Sir Michael


Bennett, Sir Frederic (Torbay)
Edwards, Nicholas (Pembroke)
Hawkins, Paul


Bennett, Dr Reginald (Fareham)
Emery, Peter
Heath, Rt Hon Edward


Biffen, John
Eyre, Reginald
Heseltine, Michael


Blaker, Peter
Fairbairn, Nicholas
Hicks, Robert


Boscawen, Hon Robert
Fairgrieve, Russell
Higgins, Terence L.


Bowden, A. (Brighton, Kemptown)
Farr, John
Holland, Philip


Brittan, Leon
Fisher, Sir Nigel
Hordern, Peter


Brotherton, Michael
Fletcher, Alex (Edinburgh N)
Howe, Rt Hon Sir Geoffrey


Brown, Sir Edward (Bath)
Fletcher-Cooke, Charles
Howell, David (Guildford)


Bryan, Sir Paul
Fowler, Norman (Sutton C'f'd)
Howell, Ralph (North Norfolk)


Buck, Antony
Fox, Marcus
Hurd, Douglas


Budgen, Nick
Gardner, Edward (S Fylde)
Hutchison, Michael Clark


Bulmer, Esmond
Gilmour, Rt Hon Ian (Chesham)
Irving, Charles (Cheltenham)


Burden, F. A.
Gilmour, Sir John (East Fife)
James, David


Carlisle, Mark
Goodhart, Philip
Jenkin, Rt Hon P. (Wanst'd&amp;;W'df'd)


Clark, Alan (Plymouth, Sutton)
Goodhew, Victor
Jessel, Toby


Clark, William (Croydon S)
Goodlad, Alastair
Johnson Smith, G. (E Grinstead)


Clarke, Kenneth (Rushcliffe)
Gorst, John
Jopling, Michael


Clegg, Walter
Gow, Ian (Eastbourne)
Joseph, Rt Hon Sir Keith


Cockcroft, John
Gower, Sir Raymond (Barry)
Kaberry, Sir Donald


Cope, John
Gray, Hamish
Kershaw, Anthony


Corrie, John
Grieve, Percy
Kimball, Marcus


Costain, A. P.
Griffiths, Eldon
King, Evelyn (South Dorset)


Crouch, David
Grist, Ian
King, Tom (Bridgwater)


Crowder, F. P.
Grylls, Michael
Kirk, Peter

Kitson, Sir Timothy
Neubert, Michael
Sims, Roger


Knight, Mrs Jill
Newton, Tony
Sinclair, Sir George


Knox, David
Normanton, Tom
Skeet, T. H. H.


Lamont, Norman
Onslow, Cranley
Smith, Dudley (Warwick)


Langford-Holt, Sir John
Osborn, John
Speed, Keith


Latham, Michael (Melton)
Page, John (Harrow West)
Spence, John


Lawrence, Ivan
Page, Rt Hon R. Graham (Crosby)
Sproat, Iain


Lawson, Nigel
Pardoe, John
Stanbrook, Ivor


Le Marchant, Spencer
Pattie, Geoffrey
Stanley, John


Lester, Jim (Beeston)
Penhaligon, David
Steel, David (Roxburgh)


Loveridge, John
Percival, Ian
Stewart, Ian (Hitchin)


Luce, Richard
Peyton, Rt Hon John
Stokes, John


McAdden, Sir Stephen
Pink, R. Bonner
Stradling Thomas, J.


McCrindle, Robert
Prior, Rt Hon James
Tapsell, Peter


Macfarlane, Neil
Raison, Timothy
Taylor, Teddy (Cathcart)


MacGregor, John
Rathbone, Tim
Tebbit, Norman


Macmillan, Rt Hon M. (Farnham)
Rawlinson, Pt Hon Sir Peter
Temple-Morris, Peter


McNair-Wilson, M. (Newbury)
Rees, Peter (Dover &amp; Deal)
Townsend, Cyril D.


McNair-Wilson, P. (New Forest)
Rees-Davies, W. R.
Trotter, Neville


Madel, David
Renton, Rt Hon Sir D. (Hunts)
Tugendhat, Christopher


Marshall, Michael (Arundel)
Renton, Tim (Mid-Sussex)
van Straubenzee, W. R.


Mates, Michael
Rhys Williams, Sir Brandon
Vaughan, Dr Gerard


Mather, Carol
Ridsdale, Julian
Viggers, Peter


Mawby, Ray
Rifkind, Malcolm
Wakeham, John


Mayhew, Patrick
Rippon, Rt Hon Geoffrey
Walker-Smith, Rt Hon Sir Derek


Meyer, Sir Anthony
Roberts, Michael (Cardiff NW)
Wall, Patrick


Miller, Hal (Bromsgrove)
Roberts, Wyn (Conway)
Warren, Kenneth


Mills, Peter
Rodgers, Sir John (Sevenoaks)
Weatherill, Bernard


Miscampbell, Norman
Ross, Stephen (Isle of Wight)
Wells, John


Mitchell, David (Basingstoke)
Rossi, Hugh (Hornsey)
Whitelaw, Rt Hon William


Monro, Hector
Rost, Peter (SE Derbyshire)
Wiggin, Jerry


Moore, John (Croydon C)
Sainsbury, Tim
Winterton, Nicholas


Morgan, Geraint
St. John-Stevas, Norman
Wood, Rt Hon Richard


Morgan-Giles, Rear-Admiral
Scott, Nicholas
Young, Sir G. (Eating, Acton)


Morris, Michael (Northampton S)
Scott-Hopkins, James
Younger, Hon George


Morrison, Charles (Devizes)
Shaw, Giles (Pudsey)



Morrison, Hon Peter (Chester)
Shaw, Michael (Scarborough)
TELLERS FOR THE NOES:


Neave, Airey
Shepherd, Colin
Mr. W. Benyon and


Nelson, Anthony
Shersby, Michael
Mr. Anthony Berry

Question accordingly agreed to.

Subsequent Lords amendment disagreed to.

Committee appointed to draw up reasons to be assigned to the Lords for disagreeing to their Amendments to the Bill: Mr. John Ellis, Mr. Norman Lamont, Mr. Robert Maclennan, Mr. Michael Neubert, and Mr. Alan Williams; Three to be the quorum.—[Mr. Maclennan.]

To withdraw immediately.

Reason for disagreeing to the Lords amendments reported, and agreed to; to be communicated to the Lords.

MALTA REPUBLIC BILL [LORDS]

Order for Second Reading read.

11.5 p.m.

The Under-Secretary of State for Foreign and Commonwealth Affairs (Miss Joan Lestor): I beg to move, That the Bill be now read a Second time.
The Constitution of Malta was amended on 13th December last year and Malta then became a republic within the Commonwealth. As the House is aware, when a Commonwealth country makes this change from a monarchical to a republican Constitution it is necessary for legislation to be introduced in the United Kingdom to make appropriate consequential changes in our own law.
In accordance with established practice on previous occasions, the proposed legislation is short and, I believe, uncontroversial. The Bill itself provides that the law of the United Kingdom, the Channel Islands and the Isle of Man existing on 13th December 1974 in relation to Malta and to persons and things belonging to or connected with Malta is not affected by Malta's change to re-publican status. Much of the legislation


on the statute book which relates to Commonwealth countries was formulated when those countries were under Her Majesty's sovereignty. As a result, one finds in it terms such as parts of Her Majesty's dominions
and it is in order that such legislation should continue to cover Malta in her new status that the present Bill is required.
The Bill will have the same effect on the law of the United Kingdom's dependent territories in so far as that consists of Acts of the United Kingdom Parliament extending to them, and also of Orders in Council extending such Acts to them. The local legislatures in the dependencies do not have the competence to make the necessary provision themselves.
Malta remains a full member of the Commonwealth. The other member countries, including Britain, were consulted and have welcomed her continued membership. A number of other Commonwealth countries have become republics during their membership of the Commonwealth and these changes have not affected the status of Her Majesty as Head of the Commonwealth nor the esteem in which she is held by the peoples.
Malta is a fully independent nation and has been since 1964. We do not believe that her new status as a republic will in any way affect the good working relations between our two countries. The close bonds of friendship between us have been built up over more than a century of co-operation and have survived through times of great hardship, particularly in the dark days of the war, when the Maltese people inspired the admiration of so many with their steadfastness and courage in the face of great affliction.
We hope that our offer of technical assistance will make a valuable contribution to Malta's welfare. Likely fields for it are currently being discussed with the Maltese Government.
The first President of the new Republic is Sir Anthony Mamo, the former Governor General. Mr. Mintoff continues as Prime Minister.
Messages of goodwill for the prosperity of the new republic were sent on 13th December from Her Majesty the Queen, from the Prime Minister and from the

Foreign and Commonwealth Secretary. I am sure that the House will want to join with me—

Mr. John Page: Before the hon. Lady draws to the end of her peroration, could she tell the House, in a few words, the major changes which the Bill will make?

Miss Lestor: The Bill makes changes so as to meet the necessary requirements to take account in our own legislation of the fact that Malta has become a republic. When Malta became independent it was assumed and known that she would ultimately go on to be a republic and that a Bill to make Malta a republic would have to pass through the House. Therefore, those changes, such as they were, were already incorporated in the independence Bill. Therefore, there are no basic changes which we have to take into consideration. Malta is a republic. All the relationships we have had with Malta in the past, and all the results flowing from those relations, still apply.

11.11 p.m.

Mr. Christopher Tugendhat: I gather that, in the absence of the Secretary of State for Foreign and Commonwealth Affairs and the other Ministers, the Under-Secretary of State is in charge of the Foreign Office. I should like to wish her the best of good fortune in this onerous task, which I am sure that she will not wish to last for too long.
I do not believe in repetition. As 1 think our noble Friends in the other place made clear, we accept the Government's interpretation of the Bill. It is very much on the same lines as previous measures, the most recent of which was the Sri Lanka Republic Act 1972. We associate ourselves with the good wishes which the Government have expressed to Malta.
Malta has been associated with this country for a long time. The bonds which bind us and that island are still very close. Malta is a member of the Commonwealth and has an association with the European Community. I am sure that the Under-Secretary of State, like myself, hopes that our joint connection with that organisation will remain in its present happy state for a long time to come. Malta is also in the ambit of NATO. We hope that that will continue.
We are also pleased that nothing in this Bill in any way changes the status or position of the Maltese people living in this country, who make a notable contribution to our life. Again, nothing in the Bill changes or alters the arrangements concerning emigration from Malta to this country. In other words, this is simply a tidying-up measure which enables the Maltese people to go on their way as a republic.
We should like to wish the people of Malta God-speed in their decision and to associate ourselves with the good wishes which the Government have expressed.

11.13 p.m.

Rear-Admiral Morgan-Giles: I feel that it is appropriate for a former naval person to speak for one minute about this Bill and to recall the connection which runs like a golden thread through the history of the United Kingdom and Malta.
Although it is a fait accompli that Malta is a republic, I regret it. I feel that both Malta and Britain may in due course come to regret it as well. I hope, however, that the new status of Malta within the Commonwealth will allow continuing economic and political cooperation and, subject to the vicissitudes of Government policy, co-operation in defence matters too, because the facts of geography remain as they have been through the centuries, in that Malta is the key to the Mediterranean.

11.15 p.m.

Mr. John Page: As one who knows Malta well and who loves Malta dearly, I was sad when Front Bench speakers seemed to consider as a matter of comparative unimportance the change of the present status of Malta to that of a full republic. It seems to me that the ties of the Commonwealth must be extremely weak, fibrous and thin ii they can disappear by a wave of a wand.
It is often considered unwise and improper to involve the Chair in a debate, but I well remember that you, Mr. Deputy Speaker, were on the Government Front Bench at a time when Malta was going through one of her most difficult periods and that you stood up manfully for the people of Malta.
Like my hon. and good Friend the Member for Winchester (Rear-Admiral Morgan-Giles), I wish Malta well in the future, and I can confirm what the Minister said about the high esteem in which Her Majesty the Queen is held by the people of Malta. But when, before becoming a Member of this House, I was asked by one of my hon. Friends who was then Vice-Chairman of the Conservative Party whether I had any major disagreements with the party's thinking, my reply was that I thought that once we had independence and republics within the Commonwealth we could write off the Commonwealth. I believe that I have been proved right over these past 15 years. This seems to be yet another sad but, I suppose, inevitable addition to the weakness of the British Commonwealth in allowing republics and independence within it.
There are two matters of detail about which I wish to ask the hon. Lady. First, what will be the position of appeals to the Privy Council in the new circumstances? Secondly will there be any change in the agreed figures of the immigration quota from Malta? It would seem insignificant if there were no change. It would be significant if there were a change. In this significant moment for Malta, the Commonwealth and this House of Commons, I should like to know the answers to those two questions.

11.18 p.m.

Mr. Anthony Kershaw: It is difficult to understand how the Minister can say that there will be no difference in the situation between our country and Malta as a consequence of this Bill when in her Government's White Paper on defence it is hinted clearly that when the present defence treaty with Malta ends it is not proposed to renew it, that it is not expected that it will be renewable, and that measures are being taken now in that regard. How the hon. Lady can say that no change is contemplated surpasses imagination.

11.19 p.m.

Miss Joan Lestor: I should not like anything to surpass the imagination of the hon. Member for Stroud (Mr. Kershaw). His argument is quite accurate. But the point is that it is not because of the Bill. I was asked what changes arose as a result of the Bill. Defence matters


are not the direct result of the Bill. This is not a matter of controversy, and I am not trying to pretend that something is when it is not. I should have thought that the hon. Gentleman would have been aware of that.
As for appeals to the Privy Council, there is no provision in the law of Malta itself for appeals to be brought from the Maltese courts to Her Majesty in Council or to the Judicial Committee. It has not, therefore, been necessary to make any reference to such appeals in the Bill.
As the hon. Member for the City of London and Westminster, South (Mr. Tugendhat) pointed out, there is no change concerning immigration and relations between Britain and Malta. As he also pointed out, I am in charge of the Foreign and Commonwealth Office at the present time, and, therefore, it is not for me to pursue the point about the EEC and related matters.
I am grateful to hon. Members for the welcome they have given to the Bill. I do not regard it in terms of regret that Malta has become a republic. Whatever our views may be about that, I am sure that all of us, as has been indicated, join in extending to the President, the Government and the people of Malta our very best wishes and the expression of our pleasure that they wish to remain as members of the Commonwealth.

11.21 p.m.

Mr. Victor Goodhew: Before we part with the Bill I should like to place on record the memories that some of us have of the gallantry of the people of Malta during the war. The fact that that country of all countries was awarded a British decoration, the George Cross, which is normally awarded only to individuals, is something that we hope the Maltese will always prize. It is a memory that we hold dear. I hope that it will always bind us to the people of Malta, despite the fact that many of us regret the moving away commemorated by the Bill.

Question put and agreed to.

Bill accordingly read a Second time.

Bill committed to a Committee of the whole House—[Miss Boothroyd.]

Bill immediately considered in Committee.

[MR. GEORGE THOMAS in the Chair]

Clause I ordered to stand part of the Bill.

Clause 2

SHORT TITLE

Question proposed, That the clause stand part of the Bill.

11.22 p.m.

Mr. John Page: I was interested in the answer that the hon. Lady the Under-Secretary gave—

The Chairman: Order. All that the hon. Gentleman is able to discuss now is the title of the Bill and that
This Act may be cited as the Malta Republic Act 1975.
That is all that remains.

Mr. Page: I thought that this was the Committee stage of the Bill and that we were discussing it in Committee.

The Chairman: It is the Committee stage, but we have passed Clause 1 and are now on the short title of the Bill. It is only the title of the Bill that remains to be discussed.

Question put and agreed to.

Clause 2 ordered to stand part of the Bill.

Bill reported, without amendment.

Motion made, and Question, That the. Bill be now read the Third time, put forthwith pursuant to Standing Order No. 56 (Third Reading).

Mr. John Page: rose—

Mr. Deputy Speaker (Mr. George Thomas): Order. The question has to be decided forthwith.

Question agreed to.

Bill accordingly read the Third time and passed, without amendment.

ADJOURNMENT

Motion made, and Question proposed, That this House do now adjoun.—[Miss. Boothroyd.]

COUNTESTHORPE (HEALTH CENTRE)

11.24 p.m.

Mr. Nigel Lawson: I was interested in that lesson in procedure, Mr. Deputy Speaker.
The scandal of Countesthorpe health centre is, first, that there is not one, and, secondly, how this has come about. I should like to go over the history fairly briefly.
Over the past few years the population of Countesthorpe has trebled from 2,000 to pretty nearly 6,000. In addition, the surrounding villages, which are in the same catchment area for general practitioner services, have a population of another 2,000. The development proposals already in the pipeline will increase the population of Countesthorpe by a further 2,500, making a total population in the catchment area of more than 10,000 people in only a few years.
All the people in Countesthorpe and the surrounding villages, but, above all, in Countesthorpe, are served by a partnership of three doctors, operating from a single, cramped consulting room in the private home of the senior partner. I think that everybody agrees that this is obviously an intolerable situation both for the doctors and, not least, for the wife of the senior doctor.
The people of Countesthorpe have nothing but the highest praise for the way in which the three doctors concerned have managed to provide a medical service, despite these appalling conditions, but they arc rightly seized with the real fear that before long their local medical service will collapse altogether. I am sure that the Minister will have seen the petition on that subject, signed by 1,700 residents of Countesthorpe, which I forwarded to his hon. Friend the Minister of State last month. This large number of signatures was collected with no difficulty at all over a period of only a few days, which gives some indication of the strength of local feeling on the issue.
It has long been clear that the only solution to this acute local problem is the provision of a fully equipped health centre for Countesthorpe. This was first proposed by the then county medical officer of health for Leicestershire in 1971.
During 1972 and 1973 a suitable site was acquired by the county council, and a firm of architects was thereupon commissioned, I believe for a fee of £3,500, to prepare plans for the building, the construction of which was expected to start at an early date.
But last year, as a result of the reorganisation of both local government and the National Health Service, the responsibility for health centre development was transferred from the county councils to the Department of Health and Social Security. The Department asked the Leicestershire Area Health Authority its suggested order of priorities for health centre development in the whole of Leicestershire during the current financial year, and quite rightly, the Leicestershire Area Health Authority placed Countesthorpe top of the list for the entire county. This was duly endorsed by the regional health authority officers last July, and it was generally assumed throughout the county that the construction of the Countesthorpe health centre would start this year.
Evidently it was not to be. The new Labour Government decided to use their powers to ride roughshod over local knowledge and wishes. Officers of the Department sat down with officers of the Trent Regional Health Authority and prevailed upon them to draw up a new list of priorities for health centres in Leicestershire, under which Countesthorpe was down-graded from No. 1 in the county to No. 15; in other words, from this year not to next year but to sometime or never.
Mr. Naylor, the regional administrator of the regional health authority, in a letter to Mr. Mansfield, the secretary of the South-West Leicestershire Community Health Council, dated 18th March 1975, said:
The Ministers have decided that the 1975–76 Health Centre programme be centrally selected. The RHA have formally written to the Department objecting to this decision on the grounds that it minimises rather than miximises delegation which is a central objective of the NHS reorganisation, and asked that policy be reconsidered accordingly.
I hope that the Minister will address himself to that point, among others, in his reply. In view of the clear statement,
The Ministers have decided that the 1975–76 Health Centre programme be centrally selected",


I find it astonishing that the Minister of State, when I raised the downgrading of Countesthorpe at Question Time in the House of Commons exactly a week later, should have sought to justify it by—I think the Minister will have to agree—the wholly misleading excuse:
Countesthorpe health centre was not among the list of priority schemes put forward by Trent Regional Health Authority for consideration for inclusion in the 1975-76 programme."—[Official Report, 25th March 1975; Vol. 889, c. 236.]
This may have been technically correct, but in every other sense it is a travesty of the truth.
The "central selection" of health centre priorities is determined by the Department, and rubber-stamped by regional health authorities, according to eight criteria which the Minister circulated in the Official Report of 25th March as part of his answer to my Question. Following that answer, I got in touch with all the relevant bodies—the regional health authority, the area health authority, the community health council and the local district council—on the specific question of these criteria, and I have had written replies from all of them.
The only criterion which Countesthorpe clearly does not satisfy is c in the Minister's list, since it is not
part of a larger development (including hospitals university teaching units)".
There is some disagreement among the authorities that I consulted over a and d, which are not strictly medical at all, but depend on whether the proposed centre is situated in an "urban zone" or
a new town or other new community".
Bearing in mind the rapid growth of Countesthorpe, to which I have alluded, the area health authority is of the opinion that at least one of these criteria applies, while the community health council believes that both do.
But there certainly is a clear consensus among all these bodies that Countesthorpe satisfies at least five of the eight criteria. To be precise, b is:
General practitioners are committed to present premises and are dependent upon a health centre for new premises.
A critical word has been left out of the Official Report. Criterion e is:
General practitioners have strong desire to develop primary health care but are frustrated by lack of suitable accommodation.
The next one, f, is:

Present general practitioner premises are well below modern standards and other means of improvement are not feasible.
That again is unequivocal. Criterion g is:
Proposed centre is sited where there is at present inadequate accommodation for community based nursing staff or for preventive health activities.
Finally, there is h,to which the Department attaches particular attention:
The proposed location is in a 'health deprived' area [a health deprived area should for the time being be interpreted as a locality in which the level of primary health care services falls well below the average obtaining in the Region].
I am sure the Minister will not need reminding that the whole of Leicestershire is a health deprived area. He will no doubt recall that on 20th November last there was an Adjournment debate when all the Leicestershire Members, irrespective of party, combined to complain that Leicestershire's share of National Health Service resources was the lowest of the Trent Region, which in turn was the lowest region per head in the country.
I remind the Minister of what he said in reply to that debate:
…my right hon. Friend recognises the need to continue to improve Leicester's relative position in relation to the region and the country as a whole."—[Official Report, 20th November 1974; Vol. 881, c. 1490.]
I think it is clear that, all in all, even on the basis of the Department's own criteria the case for a Countesthorpe health centre is overwhelming. Why, then, has the Department chosen to kill it —because that is what it has done by its decision? The only clue that I have been able to discover, because I cannot believe that Ministers have allowed party political considerations to affect their judgment, came in a letter from the Regional Administrator of the Trent Regional Health Authority dated 28th April in which he said, and I quote this for the last time:
Stress was also laid by Department officers on the concept or urban deprivation, which in the Leicestershire circumstances relates to the city of Leicester itself.
But how can it be right that the city should get everything and the rest of the county and the less urbanised communities, even if they are considerably built up, are neglected? How can it be


right, when the county health authority itself has carefully weighed up, from its own detailed knowledge of conditions on the ground, the relative needs of the different communities within its borders, that that judgment should be overruled—without any consultation, incidentally, with the area health authority—by the Secretary of State sitting in Whitehall?
Fortunately, the crisis at Countesthorpe has for the time being been somewhat abated by the decision, not perhaps unconnected with a certain amount of pressure on this subject, of the regional health authority and the area health authority, accepted loyally as a second best by the doctors concerned, to erect a small, prefabricated health centre in one corner of the site earmarked for the health centre proper. This, however, is not a satisfactory solution for anything other than the very short term.
The whole thing has been a shabby story in which a great deal still remains to be explained. The people of Countesthorpe feel this very strongly indeed. They and their doctors, for whom, as I have said, no praise can be too high for the way they have coped in appalling conditions, are still denied their health centre. Can they have it next year if it cannot be this year? I for one will not be satisfied unless the Minister gives an undertaking that this indeed will be so.
I want to make it clear that this is not a case of calling for higher public expenditure at a time of national economic stringency. This is a case of priorities within a given total of public expenditure, and priorities, too, within a given county. It is, above all, a case of proven need of a local community objectively assessed by those best placed to assess it not being overruled, as it has been done until now, or ignored by the man in Whitehall who thinks that he—or she— knows best.

11.37 p.m.

The Under-Secretary of State for Health and Social Security (Mr. Alec Jones): Let me say at the outset to the hon. Member for Blaby (Mr. Lawson) that I well understand the feelings of the people in the area and certainly of many organisations in the area as witnessed by their representation of the problem they face and their wish to have this health centre. When, however, the hon. Mem-

ber said towards the end of his speech that this was not a question of increasing public expenditure and that it was merely a question of priorities, I must say to him that this is the sort of argument we receive continually from hon. Members who advocate increased cuts in public expenditure in general but never the acceptance of any cut in particular.
The hon. Member knows full well that particularly in the Budget debate he called for considerable cuts in public expenditure. While we would wish that we could do more in the health sector, it is somewhat strange to hear people calling for cuts in public expenditure in general and always suggesting that their case is of higher priority than the remainder of the country.

Mr. Lawson: I thought I made is perfectly clear that I was not calling for any increase in public expenditure in this field. The fact is that the area health authority said that this should be the first priority. Unless the Minister says that there should be no health centres built at all, his case will not stand up. We arc talking about a question of priorities, not the total level of public expenditure.

Mr. Jones: Whenever one talks of priorities, it must inevitably mean a question of one item as opposed to. another. If the hon. Member advocates the inclusion of one scheme as opposed to another, he must either call for an increase in public expenditure or name which of the expenditure he would propose to cut in place of that which he proposes to include.
The 1975–76 health centre programme must be viewed in the context of the national priorities, the policies and the resources which are available at the present time. I should like to highlight the general changes of direction and emphasis before dealing with the specific issue raised by the hon Member in connection with Countesthorpe.
In relation to policies and priorities, before 1973 there were no defined guidelines indicating where health centres should be developed. Local authorities' decisions to build health centres in particular places depended primarily on the willingness of general practitioners to work from the health centres, and, provided design proposals, cost limits and


tenders were acceptable, loan sanction was approved by the central Government. Consequently, at that time, the impetus for health centre development depended more on local enthusiasm than on consideration of the quality of existing primary health care services.
In 1973 the then Conservative Government decided that loan sanction for health centre developments should be held nationally at £12 million, at 1973 price levels, and that this level should be retained for 1974–75. Because the number of schemes already proposed by local authorities—some 250—greatly exceeded the resources available, loan sanction was deferred in 1973 on many schemes, including Countesthorpe. The hon. Gentleman said that the decision to "abandon" Countesthorpe was the responsibility of the present Government: in fact, the deferment was a direct consequence of the decision of the previous Conservative Government in 1973. That Government also decided that the health centre programme should bear its share of the cuts imposed on health capital, thus reducing the allocation to £10·5 million, and announced their intention to select centrally for 1974–75 the health centre schemes considered to have the greatest priority.
When my right hon. Friend assumed office in 1974 she made clear from the outset her intention to seek to redress inequalities in health care provision by making financial allocations more responsive to health needs. In the debate on the National Health Service on 2nd December last my right hon. Friend explained that, despite the constraints within which she had to work in formulating the health capital programme for 1975–76, she had decided to give top priority to capital facilities for primary health care by increasing capital expenditure on health centres to £20 million in 1975–76. She stressed, however, her intention in this area, as in others, to be selective as a means of moving towards greater equality of provision.
My right hon. Friend also decided that the twin aims of ensuring a more equitable distribution of resources—for which the hon. Gentleman called in the previous debate—and the responsiveness of allocations to health care needs justified the continuation of central selection of schemes for the time being. It was not

a new policy but a continuation of the policy of the previous Government.
I began by saying that the health centre programme should be viewed in the context of national priorities, policies and resources. Since coming to office we have clearly indicated our views on the priorities of primary health care; we have embarked on a policy of guiding resources to areas of health deprivation, and we have increased the resources allocated to health centre developments by £5 million this year, despite our present economic stringencies.
In the case of the area covered by the Trent Regional Health Authority, the region has been given approval to start health centre schemes costing in total about £1¾ million, accounting for 11½per cent. of the national programme, whereas the corresponding allocation by the then Conservative Government for 1973–4 was about £1 million in the same price terms or 6 per cent. of the national programme. This increased percentage is evidence of our determination nationally to improve the relative position of regions too long deprived in health care terms.
The hon. Gentleman talked of the Leicestershire area as part of the Trent area. Of the amount allocated to Trent for health centres in the current year. over £500,000 is for starts in Leicestershire. This figure represents about one-third of the region's total allocation. whereas the Leicestershire area accounts for less than one-fifth of the region's population. This switch is an acceptance of my point in the previous speech to which the hon. Gentleman referred, about health centres in this area, when I called for recognition of the need to improve Leicestershire's position. In health centre provision, we have improved the position of Leicestershire and Trent.
The hon. Gentleman has been critical of the method of selection of the health centre schemes for the Trent region in the first half of 1974. Prior to the Secretary of State's decision to select the programme centrally, officers of the Trent Regional Health Authority met area health authority officers in a series of forward-looking meetings and invited areas, after consultation with family practitioner committees and other interested parties, to submit health centre proposals


and priorities for the coming year to the regional health authority.
The region intended to compile the 1975–76 programme on the basis of area health authority recommendations and the regional view of relative priorities, taking account of criteria already made known to local health authorities late in 1973 which did not, at that time, make reference to areas of health deprivation. If the hon. Gentleman is talking of areas of priority, surely it is right that we should give priority to those areas of health deprivation.
When the Secretary of State announced her decision to select the 1975–76 programme centrally, officials of my Department and the Trent Regional Health Authority, assisted by medical officers of the regional medical service, who are in close touch with primary health care matters in the region as a whole, met to consider the regional health centre programme.
The procedure adopted was, first, to consider proposals against the criteria drawn up for national selection and in the light of my right hon. Friend's wishes regarding areas of health deprivation ; secondly, to take account of the views of the priorities expressed by the area health authorities and the regional health authority and the feasibility of schemes to proceed ; thirdly, to list all schemes in descending order of service priority so that it would be possible to replace schemes that slipped from the firm programme by those next on the list, subject only to those schemes' readiness to proceed.
As a result of these joint departmental and regional considerations at officer level, a list of priorities was compiled for 1975–76 and a list for thereafter. The latter was intended to supplement the 1975–76 reserves as necessary and to act as an indicator to assist health authorities to programme future planning work.
These lists, together with those submitted originally by the area health authorities, were put to the regional health authority, which approved the later version. This was then sent to my Department for consideration and selection of the health centre programme by my right hon. Friend. Despite the fact that Leicestershire Area Health Authority

gave Countesthorpe top priority, as did Leicestershire County Council in 1973, the scheme was not among those approved by the regional health authority for a start in 1975–76.
There was no Question of a Labour Government riding roughshod. The project was not in a list approved by the regional health authority. If one talks of democracy in the local health services and giving authority to those who ought to know, and do know, the regions best, it is better to accept the views of the regional health authority rather than the view, in the hon. Gentleman's words, that the man in Whitehall knows best.

Mr. Lawson: This is a polite fiction. The regional health authority changed its list at the behest of the Department, just rubber stamped the Department's own interpretation of the criteria and forwarded a formal recommendation to the Department. The Under-Secretary must know that the people on the ground are those in the Leicestershire Area Health Authority. The headquarters of the regional health authority are in Sheffield, which is a long way from Leicester.

Mr. Jones: The hon. Member keeps talking of the list. When preparing the 1975–76 list for submission, the regional health authority approved a further list of health centres in terms of descending order of priority. The purpose of the second list was to ensure that, if selected schemes failed to start for any reason in 1975–76, another scheme could be brought forward from the ton of the second list. Countesthorpe was eighth in priority on that second list, not even top of that list. It was not that it was not a deserving case, but, as the hon. Member pointed out, there is a pressing need to provide improved premises for general practitioners in the village.
I am glad that he paid tribute to the work of the three doctors who have been practising in difficult circumstances in that area. I join with him in paying my tribute to their work. In a situation of increased but still limited resources, however, the view was taken that the problem of practice premises was capable of speedy solution by means other than the provision of a full health centre, however desirable that might be. Countesthorpe


has to be compared with other parts of the region. When we are talking of priorities we mean comparisons.
I am not saying that Countesthorpe is perfectly catered for, but it is not as bad as some other parts. This is always the difficulty when one has to decide priorities. If priorities mean anything, they must mean providing for the worst before those who are even slightly better off. It is true that the village has grown. There are 6,000 or more inhabitants, and the hon. Member suggested a future population of 10,000, but a comprehensive range of health services is already available to them locally, including facilities for chiropody, audiology, speech therapy, school clinics, ante-natal and child health clinics, and facilities for health education.
An assurance was given that proposals to provide improved surgery facilities would be put to the hard-pressed general practitioners, and on this basis Countesthorpe was not included in the current year's programme, priority being given instead to Uppingham Road in the city of Leicester. The hon. Member mentioned the possibility of Countesthorpe serving a population of 10,000 and spoke of priorities. Uppingham Road health centre will provide facilities for seven doctors serving 20,000 patients. So if one is talking purely in numbers, and I am not making heavy weather of the numbers issue, there is a clear difference.
The regional health authority, the area health authority and the Leicester family practitioner committee have secured arrangements to provide health practice premises for the general practitioners, and I am sure that I carry the hon. Member with me in expressing pleasure that the doctors concerned have accepted this offer. The new premises will provide accommodation for health visitors, midwives and other members of the primary health care team, and should be ready for occupation by the end of the summer, which is rather quicker than would have been the case if Countesthorpe health centre had been included in the 1975–76 programme.

Mr. Lawson: I am grateful to the hon. Member for giving me another opportunity. This is serious because it seems to have an implication for the whole country. Is he suggesting that any community with fewer than about 20,000 population cannot be expected to be allocated a health centre at any time under the present regime of the Department of Health and Social Security?

The Question having been proposed after Ten o'clock and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at six minutes to Twelve o'clock.